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What changed in DMC Global Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of DMC Global Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+475 added−436 removedSource: 10-K (2026-02-23) vs 10-K (2025-02-24)

Top changes in DMC Global Inc.'s 2025 10-K

475 paragraphs added · 436 removed · 349 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

101 edited+13 added−22 removed49 unchanged
Biggest changeThe following table presents our net sales based on the geographic location to where we shipped the product, regardless of the country of the actual end user. 14 Table of Contents (Dollars in Thousands) For the years ended December 31, 2024 2023 2022 United States $ 521,152 $ 597,324 $ 549,370 Canada 32,443 30,992 26,766 Germany 10,150 5,713 5,151 Oman 7,554 7,949 3,188 India 7,370 2,486 8,249 Kuwait 5,945 4,980 1,801 Saudi Arabia 5,316 4,252 2,416 China 4,689 6,438 3,902 Ukraine 3,975 2,332 — United Arab Emirates 3,788 9,227 5,107 Egypt 3,409 2,340 5,780 Netherlands 3,384 2,146 3,041 France 2,734 3,035 2,101 Indonesia 2,687 2,622 2,085 Turkey 1,820 1,258 4,602 Italy 1,584 2,110 1,816 Australia 1,386 1,866 1,816 South Africa 1,317 1,154 1,970 South Korea 850 4,562 3,242 Norway 738 1,292 1,854 Sweden 673 2,014 3,746 Belgium 637 2,009 603 Iraq 510 6,034 3,574 Rest of the world 18,740 15,053 11,906 Net sales $ 642,851 $ 719,188 $ 654,086 Company Information We are subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act").
Biggest change(Dollars in Thousands) For the years ended December 31, 2025 2024 2023 United States $ 492,433 $ 521,152 $ 597,324 Canada 21,694 32,443 30,992 Germany 18,500 10,150 5,713 United Arab Emirates 6,091 3,788 9,227 Kuwait 4,837 5,945 4,980 Oman 4,566 7,554 7,949 Indonesia 4,292 2,687 2,622 South Korea 4,281 850 4,562 Egypt 3,919 3,409 2,340 China 3,886 4,689 6,438 Saudi Arabia 3,393 5,316 4,252 Ukraine 3,304 3,975 2,332 Belgium 3,166 637 2,009 Turkmenistan 2,978 8 1,454 France 2,827 2,734 3,035 Netherlands 2,577 3,384 2,146 Pakistan 2,100 2,435 953 India 2,013 7,370 2,486 Algeria 1,935 1,929 1,429 Bahrain 1,864 2,892 1,277 Turkey 1,860 1,820 1,258 Sweden 1,819 673 2,014 Iraq 1,475 510 6,034 Australia 1,466 1,386 1,866 Thailand 1,391 1,153 580 South Africa 1,099 1,317 1,154 Romania 1,085 1,178 1,121 Malaysia 1,054 839 372 Rest of the world 7,935 10,628 11,269 Net sales $ 609,840 $ 642,851 $ 719,188 12 Table of Contents Company Information We are subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
At any time at or after September 6, 2026, Munera has the right (but not the obligation) to require the Company to purchase (the “Put Option”) its interests in Arcadia Products for a price based on the higher of (a) a value based on the acquisition purchase price and (b) a multiple of Arcadia Products’ average EBITDA for the preceding two fiscal years and its projected EBITDA for the then-current fiscal year (the “Option Purchase Price”), and at any time on or after December 23, 2024, the Company has the right (but not the obligation) to purchase all of Munera’s interests for a price calculated the same as above (the “Call Option”).
At any time on or after September 6, 2026, Munera has the right (but not the obligation) to require the Company to purchase (the “Put Option”) its interests in Arcadia Products for a price based on the higher of (a) a value based on the acquisition purchase price and (b) a multiple of Arcadia Products’ average EBITDA for the preceding two fiscal years and its projected EBITDA for the then-current fiscal year (the “Option Purchase Price”), and at any time on or after December 23, 2024, the Company has the right (but not the obligation) to purchase all of Munera’s interests for a price calculated the same as above (the “Call Option”).
The primary clad metals for the oil and gas production market are stainless steel and nickel alloys clad to steel, with some use of reactive metals such as titanium. Petroleum refining processes frequently are corrosive and operate at high temperatures and pressures.
The primary clad metals for the oil and gas production market are stainless steel and nickel alloys clad to steel, with some use of reactive metals such as titanium. Petroleum refining processes are frequently corrosive and operate at high temperatures and pressures.
When the cooling fluid is seawater, brackish, or even slightly polluted, corrosion-resistant metals are necessary. Metal selection can range from stainless steel to copper alloy to titanium. Explosion-welded clad metal is often the low-cost solution for making the tube sheets. Applications range from refrigeration chillers on fishing boats to massive air conditioning units for skyscrapers, airports, and deep underground mines.
When the cooling fluid is seawater, brackish, or even slightly polluted, corrosion-resistant metals are necessary. Metal selection can range from stainless steel to copper alloy to titanium. Explosion-welded clad metal is often the low-cost solution for making tube sheets. Applications range from refrigeration chillers on fishing boats to massive air conditioning units for skyscrapers, airports, and deep underground mines.
The weld overlay process is used by the many vessel fabricators that are often also NobelClad customers. In weld overlay cladding, the clad metal layer is deposited on the base metal using arc-welding type processes. Explosion-Welded Metal Cladding. Competition in the explosion-welded clad metal business is global, and we believe that NobelClad holds a premium market position in the industry.
The weld overlay process is used by many vessel fabricators that are often also NobelClad customers. In weld overlay cladding, the clad metal layer is deposited on the base metal using arc-welding type processes. Explosion-Welded Metal Cladding. Competition in the explosion-welded clad metal business is global, and we believe that NobelClad holds a premium market position in the industry.
NobelClad’s products are generally shipped from its manufacturing locations in the United States and Germany. Any shipping costs or duties for which NobelClad is responsible typically will be included in the price paid by the customer. Regardless of where the sale is booked, NobelClad will produce it, capacity permitting, at the location closest to the delivery place.
NobelClad’s products are generally shipped from its manufacturing locations in the United States and Germany. Any shipping costs or duties for which NobelClad is responsible will typically be included in the price paid by the customer. Regardless of where the sale is booked, NobelClad will produce it, capacity permitting, at the location closest to the delivery place.
All DS systems are operated using in-house designed and manufactured Infinity TM Control Panels. The Infinity Panel is highly intuitive and allows the gun string to be safely tested and monitored throughout the pump-down operation. The system also incorporates a shot detection function resulting in significant time and cost savings.
All DS systems are operated using in-house designed and manufactured Infinity™ Control Panels. The Infinity Panel is highly intuitive and allows the gun string to be safely tested and monitored throughout the pump-down operation. The system also incorporates a shot detection function resulting in significant time and cost savings.
This new technology allows for end users to benefit from the corrosion resistance performance and process safety that metals like zirconium, titanium and tantalum provide. Suppliers and Raw Materials NobelClad's operations involve a range of alloys, steels and other materials, such as stainless steel, copper alloys, nickel alloys, titanium, zirconium, tantalum, aluminum and other metals.
This new technology allows end users to benefit from the corrosion resistance performance and process safety that metals like zirconium, titanium and tantalum provide. Suppliers and Raw Materials NobelClad’s operations involve a range of alloys, steels and other materials, such as stainless steel, copper alloys, nickel alloys, titanium, zirconium, tantalum, aluminum and other metals.
Modern potlines use a large number of transition joints, which are typically replaced after approximately five years in service. Although primary aluminum production is the major electrochemical application for NobelClad products, there are a number of other electrochemical applications including production of zinc, magnesium, chlorine and chlorate.
Modern potlines use a large number of transition joints, which are typically replaced after approximately five years in service. Although primary aluminum production is the major electrochemical application for NobelClad products, there are several other electrochemical applications including the production of zinc, magnesium, chlorine and chlorate.
These charges enable exploration and production companies and their wireline service providers to choose from a variety of specifically designed shaped charges to match well completion design requirements. TCP Systems : DynaEnergetics Tubing Conveyed Perforating ("TCP") systems are customized for individual customer needs and well applications.
These charges enable exploration and production companies and their wireline service providers to choose from a variety of specifically designed shaped charges to match well completion design requirements. TCP Systems : DynaEnergetics Tubing Conveyed Perforating (“TCP”) systems are customized for individual customer needs and well applications.
Like the upstream oil and gas sector, the clad metals are primarily stainless steel and nickel alloys. Chemical and Petrochemical: Many common products, ranging from plastics to prescription drugs to electronic materials, are produced by chemical processes. Because the production of these items often involves corrosive agents and is conducted under high pressures or temperatures, corrosion resistant equipment is needed.
Like the upstream oil and gas sector, the clad metals are primarily stainless steel and nickel alloys. Chemical and Petrochemical: Many common products, ranging from plastics to prescription drugs to electronic materials, are produced by chemical processes. Because the production of these items often involves corrosive agents and is conducted under high pressure or temperatures, corrosion-resistant equipment is needed.
NobelClad has developed strong relationships over the years with the engineering contractors, process licensors, and equipment operating companies that frequently act as buying agents for fabricators. 11 Table of Contents Marketing, Sales, Distribution NobelClad conducts its selling efforts by marketing its services to potential customers' senior management, direct sales personnel, program managers, and independent sales representatives.
NobelClad has developed strong relationships over the years with the engineering contractors, process licensors, and equipment operating companies that frequently act as buying agents for fabricators. 9 Table of Contents Marketing, Sales, Distribution NobelClad conducts its selling efforts by marketing its services to potential customers’ senior management, direct sales personnel, program managers, and independent sales representatives.
One of the larger applications for clad equipment is in the manufacture of purified terephthalic acid (PTA), a precursor product for polyester, which is used in products as diverse as carpets and plastic bottles. The chemical market requires extensive use of stainless steel and nickel alloys, but also uses titanium, zirconium and tantalum.
One of the larger applications for clad equipment is in the manufacture of purified terephthalic acid (“PTA”), a precursor product for polyester, which is used in products as diverse as carpets and plastic bottles. The chemical market requires extensive use of stainless steel and nickel alloys, but also uses titanium, zirconium and tantalum.
These locations provide global capacity for shaped charge and perforating gun production and enhance delivery and customer service capabilities in key markets. Products IS2 / IS3: DynaEnergetics has focused on the advancement of safe and selective perforating products for use in North America’s shale, or onshore, unconventional, oil and gas industry.
These locations provide global capacity for shaped charge and perforating system production and enhance delivery and customer service capabilities in key markets. Products IS2 / IS3: DynaEnergetics has focused on the advancement of safe and selective perforating products for use in North America’s shale, or onshore, unconventional, oil and gas industry.
ITEM 1. Business References made in this Annual Report on Form 10-K to “we”, “our”, “us”, “DMC”, "DMC Global" and the “Company” refer to DMC Global Inc. and its consolidated subsidiaries. Unless stated otherwise, all dollar figures in this report are presented in thousands (000s). Overview DMC Global Inc.
ITEM 1. Business References made in this Annual Report on Form 10-K to “we”, “our”, “us”, “DMC”, “DMC Global” and the “Company” refer to DMC Global Inc. and its consolidated subsidiaries. Unless stated otherwise, all dollar figures in this report are presented in thousands (000s). Overview DMC Global Inc.
During the well drilling process, steel casing is inserted into the well and cemented in place to isolate and support the integrity of the wellbore. A perforating system, which contains a series of specialized explosive shaped charges, is used to punch holes through the casing and cement liner of the well and into the geologic formation surrounding the well bore.
After the well drilling process, steel casing is inserted into the well and cemented in place to isolate and support the integrity of the wellbore. A perforating system, which contains a series of specialized explosive shaped charges, is used to punch holes through the casing and cement liner of the well and into the geologic formation surrounding the well bore.
We are seeing an increase for equipment related to processing biomass feedstocks and biofuel end products, mostly stainless and nickel alloy clad. 9 Table of Contents Shipbuilding: The combined problems of corrosion and top-side weight drive demand for our aluminum-steel transition joints, which serve as the juncture between a ship's upper and lower structures.
We are seeing an increase for equipment related to processing biomass feedstocks and biofuel end products, mostly stainless and nickel alloy clad. Shipbuilding: The combined problems of corrosion and top-side weight drive demand for our aluminum-steel transition joints, which serve as the juncture between a ship’s upper and lower structures.
We are committed to ensuring a fair and inclusive work environment in which employees are treated with dignity and respect. We have strict policies to protect against unlawful discrimination and harassment, and a Compliance Hotline that provides an alternative and anonymous method of reporting suspected violations of the Code, DMC’s corporate policies or applicable laws.
We are committed to ensuring a work environment in which all employees are treated with dignity and respect. We have strict policies to protect against unlawful discrimination and harassment, and a Compliance Hotline that provides an alternative and anonymous method of reporting suspected violations of the Code, DMC’s corporate policies or applicable laws.
TCP enables perforating of conventional vertical wells, as well as highly deviated and horizontal wells. These types of wells are increasingly being drilled by the off-shore industry and in applications outside the U.S. TCP tools also perforate long intervals in a single trip, which significantly improves rig efficiency.
TCP enables perforating of conventional vertical wells, as well as highly deviated and horizontal wells. These types of wells are increasingly being drilled by the offshore industry and in applications outside the U.S. TCP tools also perforate long intervals in a single trip, which significantly improves rig efficiency.
We have followed a policy of seeking patent and trademark protection in countries and regions throughout the world for products and methods that appear to have commercial significance. No single patent or trademark is considered to be critical to any of Arcadia Products', DynaEnergetics', or NobelClad's operations.
We have followed a policy of 11 Table of Contents seeking patent and trademark protection in countries and regions throughout the world for products and methods that appear to have commercial significance. No single patent or trademark is considered to be critical to any of Arcadia Products’, DynaEnergetics’, or NobelClad’s operations.
In the event that there is a capacity issue at one facility, NobelClad can produce the order at its other production site, prioritizing timing. The two production sites allow NobelClad to meet customer production needs in a timely manner. Research and Development NobelClad prepares a formal research and development plan annually.
If there is a capacity issue at one facility, NobelClad can produce the order at its other production site, prioritizing timing. The two production sites allow NobelClad to meet customer production needs in a timely manner. Research and Development NobelClad prepares a formal research and development plan annually.
Competition Hot Roll Bonding and Weld Overlay. NobelClad faces competition from two primary alternative cladding technologies: hot roll bonding and weld overlay. The technologies do not always compete directly, as each has applications that are better suited, relating to metal used and thicknesses required.
Competition Hot Roll Bonding and Weld Overlay. NobelClad faces competition from two primary alternative cladding technologies: hot roll bonding and weld overlay. These technologies do not always compete directly, as each has applications that are better suited, relating to the metals used and thicknesses required.
These industries tend to be cyclical in nature, and the timing of new order inflow remains difficult to predict. Clad Metal End-Use Markets The eight broad industrial sectors discussed below comprise the bulk of demand for NobelClad’s products, with oil and gas and chemical and petrochemical constituting approximately 70% of NobelClad bookings in 2024.
These industries tend to be cyclical in nature, and the timing of new order inflow remains difficult to predict. Clad Metal End-Use Markets The eight broad industrial sectors discussed below comprise the bulk of demand for NobelClad’s products, with oil and gas and chemical and petrochemical constituting approximately 68% of NobelClad bookings in 2025.
By maintaining relationships with its existing customers, developing new relationships with prospective customers, and educating all its customers as to the technical benefits of NobelClad’s products, NobelClad endeavors to assist in setting standard specifications, both by our customers and the American Society of Mechanical Engineers and ASTM International, to ensure that the highest quality and reliability are achieved.
By maintaining relationships with its existing customers, developing new relationships with prospective customers, and educating its customers as to the technical benefits of NobelClad’s products, NobelClad strives to assist in setting standard specifications, both by our customers and the American Society of Mechanical Engineers and ASTM International, to ensure the highest quality and reliability are achieved.
DS Systems : The DS Infinity TM Factory-Assembled, Performance-Assured perforating systems combine all of DynaEnergetics' advanced technologies into a preassembled perforating gun that is armed at the well site with the Plug-and-Go™ IS2 / IS3 TF detonator. The IS2 TF detonator is wire-free and eliminates the customary process of wiring the detonator into the perforating system at the well site.
DS Systems : The DS Infinity™ 2.0 Factory-Assembled, Performance-Assured perforating systems combine all of DynaEnergetics’ advanced technologies into a preassembled perforating gun that is armed at the well site with the Plug-and-Go™ IS3 TF detonator. The IS3 TF detonator is wire-free and eliminates the customary process of wiring the detonator into the perforating system at the well site.
In 2023, we launched DS Liberator™ 2.0, which is a newly designed ballistic release tool which enables wireline service companies to disengage from a perforating string that has become stuck in the well bore. Plug and Abandonment : The DynaSlot TM perforating system is designed for plug and abandonment (P&A) operations.
In 2023, we launched DS Liberator™ 2.0, which is a newly designed ballistic release tool that enables wireline service companies to disengage from a perforating string that has become stuck in the well bore. Plug and Abandonment : The DynaSlot™ perforating system is designed for plug and abandonment (“P&A”) operations.
Arcadia Custom Arcadia Custom faces competition nationally from several large, well-known competitors and from many smaller, regional competitors. Competitive factors include product quality and design, aesthetics, dealer relationships and relationships with architects and luxury home builders.
Arcadia Custom The Arcadia Custom line faces competition nationally from several large, well-known manufacturers and from many smaller, regional competitors. Competitive factors include product quality and design, aesthetics, dealer relationships and relationships with architects and luxury home builders.
The IS2 detonators require a specific digital code for firing and are immune from induced currents and voltages, static electricity and high-frequency irradiation. These safety features substantially reduce the risk of unintentional detonation and enable concurrent perforating and hydraulic fracturing operations at well sites with multiple wellbores, improving operating efficiencies for customers.
The IS3 detonators require a specific digital code for firing and are 4 Table of Contents immune from induced currents and voltages, static electricity and high-frequency irradiation. These safety features substantially reduce the risk of unintentional detonation and enable concurrent perforating and hydraulic fracturing operations at well sites with multiple wellbores, improving operating efficiencies for customers.
DynaEnergetics also has successfully developed an encapsulated DynaSlot charge specifically designed for cutting down hole control lines. Most recently, DynaEnergetics developed its next generation DynaSlot shaped charges, designed specifically for severing and cutting flat-pack control lines, which are mounted vertically behind the wellbore tubulars.
DynaEnergetics also has successfully developed an encapsulated DynaSlot charge specifically designed for cutting down hole control lines. Most recently, DynaEnergetics developed its next generation DynaSlot shaped charges, designed specifically for severing and cutting 5 Table of Contents flat-pack control lines, which are mounted vertically behind the wellbore tubulars.
Explosion welding also can be used to weld compatible metals, such as stainless steels and nickel alloys to steel. The cladding metals are typically titanium, stainless steel, aluminum, copper alloys, nickel alloys, tantalum, and zirconium.
Explosion welding can also be used to weld compatible metals, such as stainless steels and nickel alloys to steel. The cladding metals are typically titanium, stainless steel, aluminum, copper alloys, nickel alloys, tantalum, and zirconium. The base metals are typically carbon steel, alloy steel, stainless steel and aluminum.
It is supervised by a technical committee that reviews progress quarterly and meets once a year to establish the plan for the following twelve months. Research and development projects may address process support, new products, new applications, new technologies such as additive manufacturing, and special customer-paid projects.
It is supervised by a technical committee that reviews progress quarterly and meets once a year to establish the plan for the following 12 months. Research and development projects may address process support, new products, new applications, new technologies such as additive manufacturing, and special customer-paid or co-sponsored projects.
Refer to Note 11 within Part II, Item 8 — Financial Statements and Supplementary Data for net sales, operating income, and total assets for each of our segments. Our Strategy Our strategy is to maximize the value of our company by capitalizing on the unique strengths of each of our three businesses.
Refer to Note 11 “Business Segments” within Part II, Item 8 — Financial Statements and Supplementary Data for net sales and operating income (loss) for each of our segments. Our Strategy Our strategy is to maximize the value of our company by capitalizing on the unique strengths of each of our three businesses.
Among these products are the IS2™ Intrinsically Safe Initiating Systems, which include the IS2 TM Customer Assembled (CA) detonator and the wire-free, plug-in, IS2 Top Fire (TF) detonator. The IS2 TF detonator is the key enabling technology in DynaEnergetics’ family of DS Factory-Assembled, Performance-Assured perforating systems.
Among these products are the IS2™ and IS3™ Intrinsically Safe Initiating Systems, which include the IS2™ Customer Assembled (“CA”) detonator and the wire-free, plug-in, IS3 Top Fire (“TF”) detonator. The IS3 TF detonator is the key enabling technology in DynaEnergetics’ family of DS Factory-Assembled, Performance-Assured perforating systems.
When the perforating system is initiated via an electronic or digital signal from the surface, the shaped charges detonate. DynaEnergetics designs, manufactures and sells all five primary components of a perforating system: the initiation system, shaped charges, detonating cord, gun hardware, and a control panel.
When the perforating systems are individually initiated via an electronic or digital signal from the surface, the shaped charges detonate. DynaEnergetics designs, manufactures and sells all five primary perforating-system components: the initiation system, shaped charges, detonating cord, gun hardware, and a control panel.
We offer employees benefits that vary by country and are designed to meet or exceed the requirements of local laws and to be competitive in the marketplace.
We offer employees benefits that vary by country and are designed to promote employee well-being, meet or exceed the requirements of local laws, and be competitive in the marketplace.
Its products address both new construction and repairs and remodels; and product capabilities include noise control, fire rating, built-to-order custom finishes, and other functional and aesthetic features. In 2024, Wilson Partitions accounted for approximately 11% of the net sales of Arcadia Products.
The products address both new construction and repairs and remodels; and product capabilities include noise control, fire rating, built-to-order custom finishes, and other functional and aesthetic features. In 2025, the Wilson Partitions line accounted for approximately 13% of the net sales of Arcadia Products.
During the three years ended December 31, 2024, 2023 and 2022, the DynaEnergetics segment represented approximately 45%, 44% and 40% of our consolidated net sales, respectively. DynaEnergetics’ operates manufacturing facilities in Germany and the United States. In Troisdorf, Germany, DynaEnergetics has six integrated detonator manufacturing lines, two shaped charge lines and a detonating cord manufacturing line.
During the years ended December 31, 2025, 2024, and 2023, the DynaEnergetics segment represented approximately 44%, 45%, and 44% of DMC’s consolidated net sales, respectively. DynaEnergetics operates manufacturing facilities in Germany and the United States. In Troisdorf, Germany, DynaEnergetics has six integrated detonator manufacturing lines, two shaped charge lines and a detonating cord manufacturing line.
Arcadia Custom’s sales strategy focuses on direct selling through a national internal sales team and a dealer network that market our products to architects and luxury home builders. The sales team focuses on attracting and retaining dealers by striving to consistently provide exceptional customer service, leading product designs and quality, technical expertise and competitive pricing.
The sales strategy for the Arcadia Custom line is focused on direct selling through a national internal sales team and a dealer network that markets our products to architects and luxury home builders. The sales team focuses on attracting and retaining dealers by striving to consistently provide exceptional customer service, leading product designs and quality, technical expertise and competitive pricing.
R&D costs were $4,415, $5,610, and $5,712 for the years ended December 31, 2024, 2023 and 2022, respectively. NobelClad Explosion-welded cladding technology is a method for welding metals that cannot be joined using conventional welding processes, such as titanium-steel, aluminum-steel, and aluminum-copper.
R&D costs were $4,226, $4,415, and $5,610 for the years ended December 31, 2025, 2024, and 2023, respectively. 6 Table of Contents NobelClad Explosion-welded cladding technology is a method for welding metals that cannot be joined using conventional welding processes, such as titanium-steel, aluminum-steel, and aluminum-copper.
Marketing, Sales, Distribution The Arcadia division relies on a reputation for strong customer service, quality products and competitive lead times to maintain and attract customers. It has strong relationships with local glaziers, installers and subcontractors. Wilson Partitions sells through a national in-house sales force and external sales representatives.
Marketing, Sales, Distribution The Arcadia line relies on a reputation for strong customer service, quality products and competitive lead times to maintain and attract customers. It benefits from strong relationships with local glaziers, installers and subcontractors. Wilson Partitions products are sold through a national in-house sales force and external sales representatives.
Arcadia Custom works closely with architects, owners, contractors and installers to provide support throughout the planning, design and installation phases of a residential construction process. In 2024, Arcadia Custom accounted for approximately 14% of the net sales of Arcadia Products.
The Arcadia Custom product team works closely with architects, owners, contractors and installers to provide support throughout the planning, design and installation phases of a residential construction process. In 2025, the Arcadia Custom line accounted for approximately 10% of the net sales of Arcadia Products.
Business Segments Arcadia Products Arcadia Products provides architectural building products to the U.S. construction industry through three divisions: Arcadia, which serves the commercial exteriors market; Wilson Partitions, which serves the commercial interiors market; and Arcadia Custom, which serves the high-end residential market.
Business Segments Arcadia Products Arcadia Products provides architectural building products to the U.S. construction industry through three branded product offerings: Arcadia, which serves the commercial exteriors market; Wilson Partitions, which serves the commercial interiors market; and Arcadia Custom, which is used in the high-end residential market.
These product offerings allow architects to create distinctive looks for buildings such as office towers, airports, hotels, education and athletic facilities, health care locations, government buildings, retail centers, mixed use and multi-family residential buildings, while also meeting functional requirements such as energy efficiency, hurricane, blast and other impact resistance and/or sound control.
These products allow architects to create distinctive looks for buildings such as office towers, airports, hotels, education and athletic facilities, health care facilities, government buildings, retail centers, mixed use and multi-family residential buildings, and industrial and manufacturing centers. The products also help address functional requirements such as energy efficiency, hurricane, blast and other impact resistance and/or sound control.
Anodized and painted aluminum components for all Arcadia Products divisions are manufactured in Vernon, with additional painting and manufacturing capacity in its Tucson, Arizona facility. During the years ended December 31, 2024, 2023 and 2022, Arcadia Products represented approximately 39%, 42% and 46% of our consolidated net sales, respectively.
Anodized and painted aluminum components for Arcadia Products’ applicable offerings are manufactured in Vernon, with additional painting and manufacturing capacity in its Tucson, Arizona facility. During the years ended December 31, 2025, 2024, and 2023, Arcadia Products represented approximately 40%, 39%, and 42% of DMC’s consolidated net sales, respectively.
Aluminum Production: Primary aluminum is reduced from its oxide in large electric smelters called potlines. The electric current is carried via aluminum conductors. The electricity must be transmitted into steel components for the high temperature smelting operations. Aluminum cannot be welded to steel conventionally. Explosion-welded aluminum-steel transition joints provide an energy efficient and highly durable solution for making these connections.
The electric current is carried via aluminum conductors. The electricity must be transmitted into steel components for the high temperature smelting operations. Aluminum cannot be welded to steel conventionally. Explosion-welded aluminum-steel transition joints provide an energy-efficient and highly durable solution for making these connections.
It primarily operates an integrated “hub and satellite” model in which light manufacturing, anodizing and painting of aluminum components are performed in Vernon, California, and component products are shipped to a network of service centers located in growing markets throughout the western and southwestern United States. At times, Arcadia Products also sources anodized material directly from third-party extruders.
Arcadia’s offerings are sold through an integrated “hub and satellite” network. Light manufacturing, anodizing and painting of aluminum components are performed in Vernon, California, and the component products are shipped to a network of service centers located in markets throughout the western and southwestern United States. Arcadia Products also sources some anodized material directly from third-party extruders.
The dimensional capabilities of the process are broad: cladding metal layers can range from a few thousandths of an inch to several inches in thickness and base metal thickness and lateral dimensions are primarily limited by the capabilities of the world’s metal production mills.
The dimensional capabilities of the process are broad: cladding metal layers can range from a few thousandths of an inch to several inches in thickness and base metal thickness and lateral dimensions are primarily limited by the capabilities of the world’s metal production mills. Clad metal plates are used in the construction of heavy, corrosion-resistant pressure vessels and heat exchangers.
We therefore file periodic reports, proxy statements and other information with the Securities Exchange Commission (the “SEC”). The SEC maintains an Internet site at www.sec.gov that contains reports, proxy and information statements and other information regarding issuers that file electronically. Our Internet address is www.dmcglobal.com.
We therefore file periodic reports, proxy statements and other information with the Securities Exchange Commission (the “SEC”). The SEC maintains an Internet site at www.sec.gov that contains reports, proxy and information statements and other information regarding issuers that file electronically. Our Internet address is www.dmcglobal.com. Information contained on our website does not constitute part of this Form 10-K.
The nature and extent of these warranties depend upon the product, the market and, in some cases, the customer being served. Suppliers and Raw Materials Materials used in Arcadia and Wilson Partitions' commercial products include aluminum extrusions, both finished and unfinished, paint and hardware. Materials used in Arcadia Custom's residential products include aluminum, steel, wood, paint, fabricated glass and hardware.
The nature and extent of these warranties depend upon the product, the market and, in some cases, the customer being served. 2 Table of Contents Suppliers and Raw Materials Materials used in the Arcadia and Wilson Partitions commercial product lines include both finished and unfinished aluminum extrusions, paint and hardware.
If the Put Option is exercised, the Option Purchase Price may be paid, at DMC’s option, (i) in cash or (ii) 20% in cash and 80% in shares of preferred stock of the Company. If the Company exercises the Call Option, the Option Purchase Price would be paid in cash.
If the Put Option is exercised, the Option Purchase Price may be paid, at DMC’s option, (i) in cash or (ii) 20% in cash and 80% in shares of a newly designated series of preferred stock of the Company (the “Put Preferred”) that would be authorized at that time.
On January 29, 2024, the Company announced that the Board initiated a review of strategic alternatives for the DynaEnergetics and NobelClad businesses to maximize value for shareholders and other stakeholders.
In January 2024, the Company announced that the Board initiated a review of strategic alternatives for the DynaEnergetics and NobelClad businesses to maximize value for shareholders and other stakeholders. In October 2024, the Company announced that the Board was no longer actively marketing the DynaEnergetics and NobelClad segments.
ETJ2000™, ETJ 2001™ and ETJ 3000™ : NobelClad’s electrical transition joints offer strong, low electrical resistance solutions for aluminum and zinc smelting, when anode clad and cathode applications must operate at elevated temperatures.
Shipbuilders turn to us to connect superstructures and bulkheads to steel hulls, framing and deck components. ETJ2000™, ETJ 2001™ and ETJ 3000™ : NobelClad’s electrical transition joints offer strong, low electrical resistance solutions for aluminum and zinc smelting, when anode clad and cathode applications must operate at elevated temperatures.
Arcadia Products offers high-performance products that comply with the Leadership in Energy and Environmental Design (LEED) Green Building Rating System. In addition, Arcadia Products offers renovation solutions to help modernize aging buildings, providing significantly improved energy performance. Operations Arcadia Products is headquartered in Vernon, California, and operates four manufacturing facilities and 10 fabrication and distribution facilities.
In addition, Arcadia Products offers renovation solutions to help modernize aging buildings, providing significantly improved energy performance. Operations Arcadia Products is headquartered in Vernon, California, and operates four manufacturing facilities and 10 fabrication and distribution facilities.
The entire explosion-welding process involves significant precision in all stages, and any errors can be extremely costly as they often result in the discarding of the expensive raw material metals. NobelClad’s technological expertise helps ensure precision, minimize errors, and prevent costly waste.
NobelClad uses proprietary processes and technology to produce high-quality clad metal products and limit re-work costs. The entire explosion-welding process involves significant precision in all stages, and any errors can be extremely costly as they often result in the discarding of the expensive raw material metals. NobelClad’s technological expertise helps ensure precision, minimize errors, and prevent costly waste.
We also regularly post information about our Company on our website under the "Investors" tab. 15 Table of Contents
We also regularly post information about our Company on our website under the “Investors” tab.
We maintain liability insurance that we believe adequately protects us from potential product losses and liability claims. Intellectual Property We hold a variety of intellectual property through our businesses including but not limited to patents, patent applications, registered and unregistered trademarks, trade secrets, proprietary information and know-how.
Intellectual Property We hold a variety of intellectual property through our businesses including but not limited to patents, patent applications, registered and unregistered trademarks, trade secrets, proprietary information and know-how.
Arcadia Custom Arcadia Custom serves the high-end residential construction market throughout the United States, and is supported by manufacturing facilities in California, Arizona and Connecticut. It provides a broad offering of custom, fully fabricated aluminum, steel and wood windows and doors to the luxury home market.
Arcadia Custom The Arcadia Custom product line is used by the high-end residential construction market throughout the United States, and is manufactured at production facilities in California, Arizona and Connecticut. It consists of a broad range of custom, fully fabricated aluminum, steel and wood windows and doors for the luxury home market.
In North America’s well-completion industry, perforating components traditionally have been assembled by highly trained personnel at the well site or nearby assembly facility. In 2015, DynaEnergetics began assembling its perforating systems in a controlled environment at its manufacturing facilities. The systems, marketed as DynaStage® (DS) Factory-Assembled, Performance-Assured™ perforating systems, are shipped directly to the customers’ remote shop or well site.
In North America’s well-completion industry, perforating components traditionally have been assembled by highly trained personnel at the well site or nearby assembly facility. In 2015, DynaEnergetics began assembling its perforating systems in a controlled environment at its manufacturing facilities in Blum, Texas.
Products are designed to address regional needs and preferences, and each satellite seeks to offer superior product availability, short lead times, product customization, and design and engineering support. Arcadia serves a loyal customer base consisting primarily of local and regional glazing contractors, subcontractors, commercial architects and designers.
Products are designed to address regional needs and preferences, and each satellite seeks to offer superior product availability, short lead times, product customization, and design and engineering support. Arcadia has attracted a loyal base of regional glazing contractors, subcontractors, commercial architects and designers. In 2025, the Arcadia line accounted for approximately 77% of the net sales of Arcadia Products.
Government Regulations DMC is subject to numerous environmental, legal and other governmental and regulatory requirements related to its operations worldwide. For additional details, see “Item 1(a).
Government Regulations DMC is subject to numerous environmental, legal and other governmental and regulatory requirements related to its operations worldwide. For additional details, see “Item 1A. Risk Factors—Legal and Regulatory Risks”, which is incorporated by reference in this Item 1.
If Munera’s ownership in Arcadia Products declines, the number of directors it has the right to appoint will be reduced in the manner set forth in the Operating Agreement. The Arcadia Board generally acts by majority vote of the directors, but certain matters specified in the Operating Agreement require the affirmative vote of 80% of the directors.
If Munera’s ownership in Arcadia Products declines, the number of directors it has the right to appoint will be reduced in the manner set forth in the Operating Agreement.
Since 2015, DynaEnergetics has added several new DS products to accommodate evolving industry conditions and needs. Operations The DynaEnergetics segment seeks to build on its products and technologies, as well as its sales, supply chain and distribution network.
The systems, marketed as DynaStage® (“DS”) Factory-Assembled, Performance-Assured™ perforating systems, are shipped directly to the customers’ remote shop or well site. Since 2015, DynaEnergetics has added several new DS products to accommodate evolving industry conditions and needs. Operations The DynaEnergetics segment seeks to build on its products and technologies, as well as its sales, supply chain and distribution network.
When hydraulic fracturing is employed, the perforations and channels also provide a starting point and a path for the fracturing fluid to enter and return from the formation. 5 Table of Contents In unconventional wells, multiple perforating systems, which generally range from seven inches to three feet in length, are connected end-to-end into a perforating “string.” The string is lowered into the well and then pumped by fluid across the horizontal lateral to the target location within the shale formation.
In unconventional wells, multiple perforating systems, which generally range from seven inches to three feet in length, are connected end-to-end into a perforating “string.” The string, which typically consists of 10 to 12 perforating systems, is lowered into the well and then pumped with fluid across the horizontal lateral to the target location within the shale formation.
Examples of benefits offered in the U.S. include traditional and Roth 401(k) plans with matching employer contributions; health benefits; life and disability insurance; additional voluntary insurance; paid counseling assistance; paid time off and parental leave; and a tuition reimbursement program. We have integrated these U.S. benefits programs for DMC and Arcadia Products. Health and Safety.
Examples of benefits offered in the U.S. include traditional and Roth 401(k) plans with matching employer contributions; health benefits; life and disability insurance; additional voluntary insurance; paid counseling assistance; paid time off and parental leave. Health and Safety. The health and safety of our employees is fundamental to our success.
Clad metal plates are used in the construction of heavy, corrosion resistant pressure vessels and heat exchangers. Clad metal plates consist of a thin layer of an expensive, corrosion-resistant clad metal, such as titanium or nickel alloy, which is metallurgically welded to a less expensive structural backing metal, such as carbon steel.
Clad metal plates consist of a thin layer of an expensive, corrosion-resistant clad metal, such as titanium or nickel alloy, which is metallurgically welded to a less expensive structural backing metal, such as carbon steel. For heavy equipment, clad plates generally provide an economical alternative to building the equipment solely out of a corrosion-resistant alloy.
DynaEnergetics obtains its raw materials from a number of different producers in Germany, other European countries, and the U.S., but also purchases materials from other international suppliers. 7 Table of Contents Competition DynaEnergetics faces competition from independent manufacturers of perforating products and from the industry's three largest oil and gas service companies, which produce perforating systems for their own use and also buy systems and other perforating components and specialty products from independent suppliers such as DynaEnergetics.
Competition DynaEnergetics faces competition from independent manufacturers of perforating products and from the industry’s three largest oil and gas service companies, which produce perforating systems for their own use and also buy systems and other perforating components and specialty products from independent suppliers such as DynaEnergetics.
Shaped Charges : DynaEnergetics develops and sells a wide range of shaped charges for use in its perforating systems, including the LoneStar and EchoFrac™ charges specifically designed for sale in their respective systems.
These introductions continue DynaEnergetics’ work over many years to further improve performance and reliability, and expand its product offerings. Shaped Charges : DynaEnergetics develops and sells a wide range of shaped charges for use in its perforating systems, including the LoneStar and EchoFrac™ charges specifically designed for sale in their respective systems.
DynaEnergetics utilizes a variety of raw materials for the production of oilfield perforating products, including high-quality steel tubes, steel and copper, explosives, granulates, plastics and ancillary plastic product components.
DynaEnergetics utilizes a variety of raw materials for the production of oilfield perforating products, including high-quality steel tubes, steel and copper, explosives, granulates, plastics and ancillary plastic product components. DynaEnergetics obtains its raw materials from a number of different producers in Germany, other European countries, and the U.S., but also purchases materials from other international suppliers.
NobelClad closely monitors the quality of its supplies and inspects the type, dimensions, markings, and certification of all incoming metals to ensure that the materials will satisfy applicable construction codes. NobelClad also manufactures a majority of its own explosives from standard raw materials, and we believe that this allows us to achieve higher quality and lower cost.
NobelClad closely monitors the quality of its supplies and inspects the type, dimensions, markings, and certification of all incoming metals to ensure that the materials will satisfy applicable construction codes. NobelClad sources its metals from top global manufacturers and distributors. In the U.S., NobelClad manufactures its own explosives from standard raw materials sourced from a qualified supplier in Europe.
NobelClad is a leader in the production of explosion-welded clad metal plates for use in the construction of corrosion resistant industrial processing equipment, as well as specialized transition joints for use in construction of commuter rail cars, ships, and liquified natural gas (LNG) processing equipment.
NobelClad produces explosion-welded clad metal plates for use in the construction of corrosion-resistant industrial processing equipment. NobelClad also produces specialized transition joints for a broad range of applications, including aluminum smelting, ship construction, and liquified natural gas (“LNG”) processing equipment.
Final products are processed to meet contract specific requirements for product configuration and quality/inspection level. Products NobelClad manufacturing technology is used in a variety of product applications. DetaClad™ : Our explosion clad plates and cylinders, available in 260 compatible and non-compatible metal combinations, are the basis of the world’s pressure vessels, towers and crystallizers used in many industries.
Final products are processed to meet contract-specific requirements for product configuration and quality/inspection level. Products NobelClad manufacturing technology is used in a variety of product applications.
DynaEnergetics is currently upgrading all of its perforating systems to utilize the next generation IS3 detonator, which will enhance the user experience. 6 Table of Contents DynaEnergetics has successfully expanded the family of DS perforating systems with various models: DS Echo™, for re-frac applications; DS LoneStar™, a single-shot system that delivers large, ultra-consistent entry holes with enhanced formation contact, and DS NLine™, an oriented systems that features several shaped charges on a lateral plane.
DynaEnergetics has successfully expanded the family of DS perforating systems with various models: DS Gravity 2.0, a self-orienting system that features several shaped charges in a single lateral plane; DS NLine™ 2.0, a system that can be oriented at the surface before deployment; DS LoneStar™ 2.0, a single-shot system that delivers large, ultra-consistent entry holes with enhanced formation contact; and DS Echo™, a system designed for re-frac applications.
The base metals are typically carbon steel, alloy steel, stainless steel and aluminum. 8 Table of Contents Explosion-welded clad metal is produced as flat plates or concentric cylinders, which can be further formed and fabricated into a broad range of industrial processing equipment or specialized transition joints.
Explosion-welded clad metal is produced as flat plates or concentric cylinders, which can be further formed and fabricated into a broad range of industrial processing equipment or specialized transition joints. Created using a robust cold-welding technology, explosion-welded clad products exhibit high bond strength, often exceeding that of the parent metals.
On October 21, 2024, the Company announced that the Board was no longer actively marketing the DynaEnergetics and NobelClad segments. 12 Table of Contents Human Capital DMC empowers its people and organizations by institutionalizing entrepreneurship and celebrating ingenuity. We stand behind our businesses in ways that truly add value.
Human Capital DMC empowers its people and organizations by institutionalizing entrepreneurship and celebrating ingenuity. We stand behind our businesses in ways that truly add value.
Risk Factors—Legal and Regulatory Risks”, which is incorporated by reference in this Item 1. 13 Table of Contents Insurance Our operations expose us to potential liabilities for property damage and personal injury or death as a result of the failure of a component that has been designed, manufactured, serviced, processed, or distributed by us.
Insurance Our operations expose us to potential liabilities for property damage and personal injury or death as a result of the failure of a component that has been designed, manufactured, serviced, processed, or distributed by us. On an annual basis, we re-evaluate the purchase of insurance, coverage limits and deductibles.
In addition, if the Company or all of its assets are acquired, the Call Option will be deemed to be exercised in connection with such a transaction. DynaEnergetics DynaEnergetics designs, manufactures, markets and sells perforating systems and associated hardware for the global oil and gas industry.
If the Company exercises the Call Option, the Option Purchase Price would be paid in cash. In addition, if the Company or all of its assets are acquired, the Call Option will be deemed to be exercised in connection with such a transaction.
In addition, we use a number of temporary workers at any given time, depending on workload at our businesses. Compensation and Benefits. Our compensation and benefits teams strive to develop and implement policies and programs that are fair to employees, support our business goals, maintain competitiveness, and promote shared fiscal responsibility among the Company and our employees.
Our compensation and benefits teams regularly evaluate our comprehensive benefits program, and we strive to develop and implement policies and programs that are fair to employees, support our business goals, maintain competitiveness, and promote shared fiscal responsibility among DMC and our employees.
Environmental Sustainability Arcadia Products’ operations have an ongoing focus on environmental sustainability, including hazardous waste recycling and initiatives aimed at reducing waste.
Environmental Sustainability Arcadia Products’ operations have an ongoing focus on environmental sustainability, including hazardous waste recycling and initiatives aimed at reducing waste. All of Arcadia’s commercial building products and many of our residential product offerings are made from aluminum, including recycled aluminum content.
The results of operations can be impacted by a delay between the time of a raw material cost increase and our price capture. Aluminum is our most important raw material, and we currently have the ability to source from several major suppliers. Other raw materials are readily available from a variety of domestic sources.
Aluminum is our most important raw material, and we currently have the ability to source from several major suppliers. Other raw materials are readily available from a variety of domestic sources. Arcadia Products generally has good relationships with its suppliers and strives to proactively manage raw material availability and pricing.
All of Arcadia’s commercial building products and many of our residential product offerings are made from aluminum, including recycled aluminum content. 3 Table of Contents Many of our architectural products help architects, developers, and building owners achieve their energy-efficiency and sustainability goals by improving energy performance, thereby reducing greenhouse gas emissions, providing daylight and natural ventilation, and increasing comfort and safety for occupants.
Many of our architectural products help architects, developers, and building owners achieve their energy-efficiency and sustainability goals by improving energy performance, thereby reducing greenhouse gas emissions, providing daylight and natural ventilation, and increasing comfort and safety for occupants. Arcadia Products offers high-performance products that comply with the Leadership in Energy and Environmental Design (“LEED”) Green Building Rating System.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeRisks Related to Acquisitions • We have incurred debt to finance the acquisition of 60% of Arcadia Products and may incur additional substantial financial obligations in connection with the acquisition of the remaining 40% of Arcadia Products. 17 Table of Contents • DMC is the majority shareholder of Arcadia Products, and our interest in Arcadia Products is subject to the risks normally associated with the conduct of businesses with a minority shareholder. • To the extent that we seek to further expand our business through acquisitions, we may experience issues in executing acquisitions or integrating acquired operations.
Biggest changeRisks Related to Acquisitions • We have incurred debt to finance the acquisition of 60% of Arcadia Products and may incur additional substantial financial obligations in connection with the acquisition of the remaining 40% of Arcadia Products. • DMC is the majority shareholder of Arcadia Products, and our interest in Arcadia Products is subject to the risks normally associated with the conduct of businesses with a minority shareholder. • To the extent that we seek to further expand our business through acquisitions, we may experience issues in executing acquisitions or integrating acquired operations. 14 Table of Contents Risk Factors Related to Our Common Stock • The price and trading volume of our common stock has been and may continue to be volatile, which may make it difficult for investors to resell the common stock at attractive timing or pricing. • Our business could be negatively affected as a result of actions of activist stockholders or others. • Our stockholder protection rights agreement includes terms and conditions that could discourage a takeover or other transaction that stockholders may consider favorable. • Future sales of our common stock in the public market or the issuance of equity securities, including in connection with an exercise of the Put Option, could dilute our existing stockholders and adversely affect the trading price of our common stock and our ability to raise funds in future equity offerings.
Increased negative investor sentiment toward oil and gas and preference for assets outside of traditional energy sectors could lead to higher capital costs for our customers and reduced investment in fossil fuels, thereby reducing demand for our products.
Increased negative investor sentiment toward oil and gas and preference for assets outside of traditional energy sectors could lead to higher capital costs for our customers and reduced investment in fossil fuels, thereby reducing demand for our products.
Our Operating Agreement governs our relationship with Munera, and we believe the Operating Agreement provides us with effective and sufficient control of Arcadia Products to allow the business to be operated consistent with our goals and values and with sufficient opportunity for profitable growth.
The Operating Agreement governs our relationship with Munera, and we believe the Operating Agreement provides us with effective and sufficient control of Arcadia Products to allow the business to be operated consistent with our goals and values and with sufficient opportunity for profitable growth.
In addition, as early as September 6, 2026, we may be required to pay the Option Purchase Price for some or all of Munera’s interests in Arcadia Products if Munera exercises the Put Option. Even if we elect to pay 80% of the Option Purchase Price in preferred stock, we will need to fund the remaining portion in cash.
As early as September 6, 2026, we may be required to pay the Option Purchase Price for some or all of Munera’s interests in Arcadia Products if Munera exercises the Put Option. Even if we elect to pay 80% of the Option Purchase Price in preferred stock, we will need to fund the remaining portion in cash.
Nevertheless, conducting a business with minority owners may lead to certain risks and uncertainties, which could have an adverse impact on our ability to profitably grow the Arcadia Products business, which could have a material adverse impact on our future cash flows, earnings, results of operations and financial condition.
Nevertheless, conducting a business with minority owners may lead to certain risks and uncertainties, which could have an adverse impact on our ability to profitably grow the Arcadia Products business, which could have a material adverse effect on our future cash flows, earnings, results of operations and financial condition.
These industries tend to be cyclical in nature and an economic slowdown in one or all of these industries, whether due to traditional cyclicality, general economic conditions or other factors, could impact capital expenditures within that industry.
These industries tend to be cyclical in nature and an economic slowdown in one or all of these industries, whether due to traditional cyclicality, general economic conditions or other industry-specific factors, could impact capital expenditures within that industry.
Existing or future legislation and regulations related to greenhouse gas emissions and climate change, as well as initiatives by governments, non-governmental organizations, and companies to conserve energy or promote the use of alternative energy sources, and negative attitudes toward or perceptions of fossil fuel products and their relationship to the environment, may significantly curtail demand for and production of oil and gas in areas of the world where our customers operate, and thus reduce future demand for DynaEnergetics products.
Existing or future legislation and regulations related to greenhouse gas emissions and climate change, as well as initiatives by governments, non-governmental organizations, and companies to conserve energy or promote the use of alternative energy sources, and negative attitudes toward or perceptions of fossil fuel products and their relationship to the environment, may significantly curtail demand for and production of oil and gas in areas of the world where our customers operate, and thus reduce future demand for DynaEnergetics’ products.
Any number of factors, including labor disruptions, acts of war or terrorism, military activity, trade sanctions, catastrophic weather events, the occurrence of a pandemic or other widespread illness, contractual or other disputes, unfavorable economic or industry conditions, transportation disruptions, delivery delays or other performance problems or financial difficulties or solvency problems, could disrupt our suppliers’ operations and performance, which could, in turn, lead to uncertainty in our supply chain or cause supply disruptions for us and disrupt our operations.
Any number of factors, including labor disruptions, acts of war or terrorism, military activity, civil unrest, trade sanctions, catastrophic weather events, the occurrence of a pandemic or other widespread illness, contractual or other disputes, unfavorable economic or industry conditions, transportation disruptions, delivery delays or other performance problems or financial difficulties or solvency problems, could disrupt our suppliers’ operations and performance, which could, in turn, lead to uncertainty in our supply chain or cause supply disruptions for us and disrupt our operations.
The regulatory environment governing information, data security and privacy is increasingly demanding and evolving and a data security breach could result in litigation, enforcement actions and related penalties and fines. The regulatory environment surrounding information security and privacy is increasingly demanding.
The regulatory environment governing information, data security and privacy is increasingly demanding and evolving and a data security breach could result in litigation, enforcement actions and related penalties and fines. The regulatory environment surrounding information security and privacy is increasingly complex and demanding.
If we access the credit facility to pay the Option Purchase Price, we will have to devote a substantial portion of our cash flow to meet required payments of principal and interest on this indebtedness, and if we are unable to generate sufficient cash flow to do so, or if we otherwise fail to comply with the terms of the credit facility, we could be in default under the agreement.
If we access the credit facility to pay all or a portion of the Option Purchase Price, we will have to devote a substantial portion of our cash flow to meet required payments of principal and interest on this indebtedness, and if we are unable to generate sufficient cash flow to do so, or if we otherwise fail to comply with the terms of the credit facility, we could be in default under the credit facility.
Several U.S. states have passed comprehensive privacy laws that have recently become effective. Of note among them is the California Consumer Privacy Rights Act (CPRA), which amends and expands the California Consumer Privacy (CCPA). The CPRA, which went into effect on January 1, 2023, along with the CCPA, governs the transmission, security and privacy of California residents’ personal information.
Several U.S. states have passed comprehensive privacy laws that have recently become effective. Of note among them is the California Consumer Privacy Rights Act (“CPRA”), which amends and expands the California Consumer Privacy (“CCPA”). The CPRA, which went into effect on January 1, 2023, along with the CCPA, governs the transmission, security and privacy of California residents’ personal information.
These laws and regulations relate to matters such as employment discrimination, wage and hour laws, requirements to provide and document meal and rest periods or other benefits, family leave mandates, requirements regarding working conditions and accommodations to certain employees, citizenship or work authorization and related requirements, insurance and workers’ compensation rules, healthcare laws and anti-discrimination and anti-harassment laws.
These laws and regulations relate to matters such as employment discrimination, wage and hour laws, requirements to provide and document meal and rest periods or other benefits, family leave mandates, employee classification, requirements regarding working conditions and accommodations to certain employees, citizenship or work authorization and related requirements, insurance and workers’ compensation rules, healthcare laws and anti-discrimination and anti-harassment laws.
In addition, our adoption and the reporting of certain standards or mandated compliance to certain requirements could necessitate additional investments that could impact our profitability. Further, we have established and publicly disclosed other ESG targets and goals and other sustainability commitments that are subject to a variety of assumptions, risks and uncertainties.
In addition, our adoption and the reporting of certain standards or mandated compliance with certain requirements could necessitate additional investments that could impact our profitability. Further, we have established and publicly disclosed other sustainability targets and goals and other commitments that are subject to a variety of assumptions, risks and uncertainties.
Our shooting sites require ongoing maintenance and investment, and failure to adequately maintain these sites could result in reduced access or capacity constraints. In addition, we could experience difficulty in obtaining or renewing permits because of resistance from residents in the vicinity of existing or proposed sites.
Our cladding sites require ongoing maintenance and investment, and failure to adequately maintain these sites could result in reduced access or capacity constraints. In addition, we could experience difficulty in obtaining or renewing permits because of resistance from residents in the vicinity of existing or proposed sites.
If we fail to pay the Option Purchase Price when required under the Operating Agreement, we will be in default under the agreement.
If we fail to pay the Option Purchase Price when required under the Operating Agreement, we will be in default under that agreement.
Higher interest rates make it more expensive to finance construction projects, and as a result, may reduce the demand for our products. In addition, changes in architectural design trends, demographic trends, and/or remote work trends could negatively impact demand for our products.
Elevated interest rates make it more expensive to finance construction projects, and as a result, may reduce the demand for our products. In addition, changes in architectural design trends, demographic trends, and/or remote work trends could negatively impact demand for our products.
Moreover, failure to comply with applicable requirements or the occurrence of an explosive incident may also result in the loss of our license to store and handle explosives, which would have a material adverse effect on our business, results of operations and financial conditions. 30 Table of Contents Demand for our products could be reduced by existing and future legislation, regulations and public sentiment.
Moreover, failure to comply with applicable requirements or the occurrence of an explosive incident may also result in the loss of our license to store and handle explosives, which would have a material adverse effect on our business, results of operations and financial conditions. Demand for our products could be reduced by existing and future legislation, regulations and public sentiment.
Summary of Material Risk Factors The following is a summary of the material risk factors that could adversely affect our business, financial condition, and results of operations. This summary should be read together with the more detailed descriptions of risks relating to our Company below.
Summary of Principal Risk Factors The following is a summary of the principal risk factors that could adversely affect our business, financial condition, and results of operations. This summary should be read together with the more detailed descriptions of risks relating to our Company below.
Continued or worsening conditions in the oil and gas industry generally may have a further material adverse effect on our business, financial condition, results of operations, cash flows and prospects. Consolidation of our customers and competitors may impact our results of operations.
Continued or worsening conditions in the oil and gas industry generally may have a further material adverse effect on our business, financial condition, results of operations, cash flows and prospects. Customer concentration or consolidation of our customers and competitors may impact our results of operations.
Among the factors that could affect the price of our common stock are: • changes in the architectural building products, oil and gas, industrial, or infrastructure markets; • operating and financial performance that vary from the expectations of management, securities analysts or investors; • developments in our business or in our business sectors generally; • regulatory changes affecting our industries generally or our business and operations; • the operating and stock price performance of companies that investors consider to be comparable to us; • announcements of strategic developments, acquisitions and other material events by us or our competitors; • our ability to integrate and operate the companies and the businesses that we acquire; • rumors and market speculation regarding our industries, business or trading activity; • significant amounts of short selling, the perception that short sales could occur and other speculative trading activity; • activism by any large stockholder or group of stockholders; • new positions adopted by investor stewardship groups and proxy advisory firms regarding desired ESG disclosures, policies, ranking systems and other initiatives; • changes in global financial markets and global economies and general market conditions, including volatility in foreign exchange rates, tariffs and stock, commodity, credit or asset valuations, and government actions or shutdowns.
Among the factors that could affect the price of our common stock are: • changes in the architectural building products, oil and gas, industrial, or infrastructure markets; • operating and financial performance that vary from the expectations of management, securities analysts or investors; • developments in our business or in our business sectors generally; • significant litigation; • additions or departures of key personnel; • regulatory changes affecting our industries generally or our business and operations; • the operating and stock price performance of companies that investors consider to be comparable to us; • announcements of strategic developments, acquisitions and other material events by us or our competitors; • our ability to integrate and operate the companies and the businesses that we acquire; • rumors and market speculation regarding our industries, business or trading activity; • significant amounts of short selling, the perception that short sales could occur and other speculative trading activity; • activism by any large stockholder or group of stockholders; • new positions adopted by investor stewardship groups and proxy advisory firms regarding desired sustainability disclosures, policies, ranking systems and other initiatives; and • changes in global financial markets and global economies and general market conditions, including volatility in foreign exchange rates, tariffs and stock, commodity, credit or asset valuations, and government actions or shutdowns.
In the event that one or more of our patents are challenged, a court or the United States Patent and Trademark Office (USPTO) may invalidate the patent(s) or determine that the patent(s) is not enforceable, which could harm our competitive position.
In the event that one or more of our patents are challenged, a court or the United States Patent and Trademark Office (“USPTO”) may invalidate the patent(s) or determine that the patent(s) is not enforceable, which could harm our competitive position.
The stock markets in general have experienced extreme volatility that has at times been unrelated to the operating performance of particular companies, and these fluctuations may adversely affect the trading price of our common stock. 36 Table of Contents Our business could be negatively affected as a result of actions of activist stockholders or othe r s.
The stock markets in general have experienced extreme volatility that has at times been unrelated to the operating performance of particular companies, and these fluctuations may adversely affect the trading price of our common stock. Our business could be negatively affected as a result of actions of activist stockholders or othe r s.
Our shooting sites in Pennsylvania and in Germany are located in mines. Our Pennsylvania shooting site is subleased under an arrangement pursuant to which we provide certain contractual services to the sub-landlord, and this sublease expires in 2054.
Our cladding sites in Pennsylvania and in Germany are located in mines. Our Pennsylvania cladding site is subleased under an arrangement pursuant to which we provide certain contractual services to the sub-landlord, and this sublease expires in 2054.
The OECD/G20 Base Erosion and Profit Shifting Project (or BEPS Project) is developing an international framework to combat tax avoidance by multinational enterprises and countries where the Company is subject to taxes are independently evaluating their corporate tax policy. Tax legislation and enforcement could adversely impact the Company’s tax provision and the value of deferred tax assets and liabilities.
The OECD/G20 Base Erosion and Profit Shifting Project (or “BEPS Project”) is developing an international framework to combat tax avoidance by multinational enterprises and countries where the Company is subject to taxes are independently evaluating their corporate tax policy. Tax legislation and enforcement could adversely impact the Company’s tax provision and the value of deferred tax assets and liabilities.
A change in the mix of earnings and losses in countries with differing statutory tax rates, changes in our business or structure, or disputes about intercompany transfer pricing arrangements may result in higher effective tax rates for the Company. 33 Table of Contents Our future effective tax rates could be adversely affected by changes in tax laws or their interpretation, both domestically and internationally.
A change in the mix of earnings and losses in countries with differing statutory tax rates, changes in our business or structure, or disputes about intercompany transfer pricing arrangements may result in higher effective tax rates for the Company. Our future effective tax rates could be adversely affected by changes in tax laws or their interpretation, both domestically and internationally.
The prices for oil and natural gas have historically been volatile and can be affected by a variety of factors, including: • changes in the supply of and demand for hydrocarbons, which are affected by general economic, business and regulatory conditions; • the ability or willingness of the Organization of Petroleum Exporting Countries (“OPEC”) and other oil producing companies to set and maintain production levels for oil; • oil and gas production levels in the U.S. and in other non-OPEC countries; • the level of excess production capacity; • speculation as to the future price of oil and the speculative trading of oil and natural gas futures contracts; • government initiatives to restrict oil and gas drilling or development or promote the use of renewable energy sources and public sentiment regarding the same; • political and economic uncertainty, geopolitical unrest, and acts of war; • the level of worldwide oil and gas exploration and production activity; • access to potential resources; • changes in governmental policies, subsidies, or sanctions; • the costs of exploring for, producing and delivering oil and gas; • technological advances affecting energy consumption; and • weather conditions.
The prices for oil and natural gas have historically been volatile and can be affected by a variety of factors, including: • changes in the supply of and demand for hydrocarbons, which are affected by general economic, business and regulatory conditions; • the ability or willingness of the Organization of Petroleum Exporting Countries (“OPEC”) and other oil producing companies to set and maintain production levels for oil; • oil and gas production levels in the U.S. and in other non-OPEC countries; • the level of excess production capacity; • speculation as to the future price of oil and the speculative trading of oil and natural gas futures contracts; 16 Table of Contents • government initiatives to restrict oil and gas drilling or development or promote the use of renewable energy sources and public sentiment regarding the same; • political and economic uncertainty, geopolitical unrest, and acts of war; • the level of worldwide oil and gas exploration and production activity; • access to potential resources; • changes in governmental policies, subsidies, sanctions, and tariffs; • the costs of exploring for, producing and delivering oil and gas; • technological advances affecting energy consumption; and • weather conditions, natural disasters, and pandemics or epidemics.
If demand or metals prices decline or if supply chain issues or similar disruptions persist, our sales would be adversely affected, and this could have a material adverse effect on our business, financial condition, and results of operations. We are dependent on a relatively small number of large projects and customers for a significant portion of our net sales.
If demand or supply chain issues or similar disruptions persist, our sales would be adversely affected, and this could have a material adverse effect on our business, financial condition, and results of operations. We are dependent on a relatively small number of large projects and customers for a significant portion of our net sales.
Our cladding process involves the detonation of large amounts of explosives. As a result, the sites where we perform cladding must meet certain criteria, including adequate distance from densely populated areas, specific geological characteristics, and the ability to comply with local noise and vibration abatement regulations in conducting the process.
Our cladding process involves the detonation of large amounts of explosives. As a result, the sites where we perform cladding must meet certain criteria, including adequate distance from densely populated areas, specific geological 19 Table of Contents characteristics, and the ability to comply with local noise and vibration abatement regulations in conducting the process.
Moreover, we cannot be sure of when during the future twelve-month period we will be able to recognize revenue corresponding to our backlog nor can we be certain that revenues corresponding to our backlog will not fall into periods beyond the twelve-month horizon. 23 Table of Contents There is a limited availability of sites suitable for cladding operations.
Moreover, we cannot be sure of when during the future twelve-month period we will be able to recognize revenue corresponding to our backlog nor can we be certain that revenues corresponding to our backlog will not fall into periods beyond the twelve-month horizon. There is a limited availability of sites suitable for cladding operations.
We could also be held liable for any and all consequences arising out of human exposure to hazardous substances or other environmental damage. Failure to comply with applicable federal, state and local employment and labor laws and regulations could have a material, adverse impact on our business.
We could also be held liable for any and all consequences arising out of human exposure to hazardous substances or other environmental damage. 28 Table of Contents Failure to comply with applicable federal, state and local employment and labor laws and regulations could have a material, adverse impact on our business.
If our customers delay paying or fail to pay us a significant amount of our outstanding receivables, it could have a material adverse effect on our liquidity, consolidated results of operations, and consolidated financial condition. New or existing tariffs and other trade measures could adversely affect our results of operations, financial position and cash flows.
If our customers delay paying or fail to pay us a significant amount of our outstanding receivables, it could have a material adverse effect on our liquidity, consolidated results of operations, and consolidated financial condition. 23 Table of Contents New or existing tariffs and other trade measures could adversely affect our results of operations, financial position and cash flows.
While maintaining excess capacity or higher levels of employment entails short-term costs, reductions in capacity or employment could impair our ability to respond to new opportunities and programs, market improvements or to maintain customer relationships. Our decisions to reduce costs and capacity can affect our short-term and long-term results and result in restructuring charges.
While maintaining excess capacity or higher levels of employment entails short-term costs, reductions in capacity or employment could impair our ability to respond to new opportunities and programs, market improvements or to maintain 17 Table of Contents customer relationships. Our decisions to reduce costs and capacity can affect our short-term and long-term results and result in restructuring charges.
These factors may cause suppliers to be unable to meet their commitments or to negatively change the terms of supply arrangements. 18 Table of Contents The loss of, or substantial decrease in the availability of, products from our suppliers, or the loss of a key supplier, could adversely impact our financial condition and results of operations.
These factors may cause suppliers to be unable to meet their commitments or to negatively change the terms of supply arrangements. The loss of, or substantial decrease in the availability of, products from our suppliers, or the loss of a key supplier, could adversely impact our financial condition and results of operations.
A failure to adequately or timely meet stakeholder expectations and reporting requirements may result in noncompliance with any imposed regulations, the loss of business, reputational impacts, diluted market valuation, an inability to attract and retain customers, and an inability to attract and retain top talent.
A failure to adequately or timely meet varied and sometimes contradictory stakeholder expectations and reporting requirements may result in noncompliance with any imposed regulations, the loss of business, reputational impacts, diluted market valuation, an inability to attract and retain customers, and an inability to attract and retain top talent.
We rely on trade secret protection for certain aspects of our technology, in part through confidentiality and other written agreements with our employees, consultants and third parties. Through these and other written agreements, we attempt to control access to and distribution of our intellectual property documentation and other proprietary technology information.
We rely on trade secret protection for certain aspects of our technology, in part through confidentiality and other written agreements with our 30 Table of Contents employees, consultants and third parties. Through these and other written agreements, we attempt to control access to and distribution of our intellectual property documentation and other proprietary technology information.
In addition, some international, national, state and local governments and agencies have also adopted laws and regulations or are evaluating proposed legislation and regulations that are focused on directly limiting the extraction of shale gas or oil using hydraulic fracturing.
In addition, some international, national, state and local governments and agencies have also adopted laws and regulations or are evaluating proposed legislation and regulations that are focused on directly limiting the extraction of shale 18 Table of Contents gas or oil using hydraulic fracturing.
As of December 31, 2024, we were in compliance with all financial covenants and other provisions of the credit agreement, as amended, and our other loan agreements.
As of December 31, 2025, we were in compliance with all financial covenants and other provisions of the credit agreement, as amended, and our other loan agreements.
In addition, our company and our operating subsidiaries are exposed to foreign currency risk to the extent that we or they enter into transactions denominated in currencies other than our or their respective functional currencies. For example, DynaEnergetics Europe's functional currency is euros, but its sales often occur in U.S. dollars.
In addition, our company and our operating subsidiaries are exposed to foreign currency risk to the extent that we or they enter into transactions denominated in currencies other than our or their respective functional currencies. For example, DynaEnergetics Europe’s functional currency is euros, but its sales often occur in 22 Table of Contents U.S. dollars.
We have been in the past and may in the future be involved in litigation relating to alleged infringement by us of others’ patents or other intellectual property rights. We have an active "freedom to operate" review process for our technology, but there is no assurance that future infringement claims will not be asserted.
We have been in the past and may in the future be involved in litigation relating to alleged infringement by us of others’ patents or other intellectual property rights. We have an active “freedom to operate” review process for our technology, but there is no assurance that future infringement claims will not be asserted.
The floor value will apply even if Arcadia Products' performance fails to meet our expectations, and we may find it difficult to obtain additional financing, if needed, for the payment of the Option Purchase Price.
The floor value applies even if Arcadia Products' performance fails to meet our expectations, and we may find it difficult to obtain additional financing, if needed, for the payment of the Option Purchase Price.
The risk of cybersecurity incidents may increase with political and economic instability or warfare (including the ongoing hostilities between Russia and Ukraine) and the use of artificial intelligence to make intrusion attempts look more legitimate. Various measures have been implemented to manage our risks related to information technology systems and network disruptions.
The risk of cybersecurity incidents may increase with political and economic instability or warfare (including the ongoing hostilities between Russia and Ukraine and ongoing conflicts in the Middle East) and the use of artificial intelligence (“AI”) to make intrusion attempts look more legitimate. Various measures have been implemented to manage our risks related to information technology systems and network disruptions.
Risk Factors Related to NobelClad • NobelClad’s business is dependent on sales to a limited number of customers in cyclical markets and our results are affected by the price of metals. • We are dependent on a relatively small number of large projects and customers for a significant portion of our net sales. • Our backlog figures may not accurately predict future sales. • There is a limited availability of sites suitable for cladding operations. • There is no assurance that we will continue to compete successfully against other manufacturers of competitive products. • Customers have the right to change orders until products are completed. • Our costs could substantially increase if we experience a large claim or a significant number of warranty claims. 16 Table of Contents Risk Factors Related to our Businesses Generally • Our efforts to grow and transform our businesses may require significant investments; if our strategies are unsuccessful, our business, results of operations and/or financial condition may be materially adversely affected. • Our operations are subject to political and economic instability and risk of government actions that could have a material adverse effect on our business, consolidated results of operations, and consolidated financial condition. • Inflation and higher interest rates have, and may continue to, adversely affect our financial position and results of operations. • Our business, financial condition and results of operations could be adversely affected by disruptions in the global and European economies caused by the ongoing military action between Russia and Ukraine. • Our operating results fluctuate from quarter to quarter. • We are exposed to potentially volatile fluctuations of the U.S. dollar (our reporting currency) against the currencies of many of our operating subsidiaries. • Disruptions or delays involving our suppliers or increases in prices for the components, raw materials and parts that we obtain from our suppliers could have a material adverse effect on our business and consolidated results of operations. • The terms of our indebtedness contain a number of restrictive covenants, the breach of any of which could result in acceleration of payment of our credit facilities. • If our customers delay paying or fail to pay a significant amount of our outstanding receivables, it could have a material adverse effect on our liquidity, consolidated results of operations, and consolidated financial condition. • New or existing tariffs and other trade measures could adversely affect our results of operations, financial position and cash flows. • Failure to attract and retain key personnel and source sufficient labor could adversely affect our current operating results. • A failure in our information technology systems or those of third parties, including those caused by security breaches, cyber-attacks or data protection failures, could disrupt our business, result in significant legal costs and other losses and damage our reputation. • Failure to establish and maintain adequate internal controls over financial reporting could result in the inability to report our financial results in a timely and reliable manner, which could harm our business and impact the value of our securities.
Risk Factors Related to NobelClad • NobelClad’s business is dependent on sales to a limited number of customers in cyclical markets and our results are affected by the price of metals. • We are dependent on a relatively small number of large projects and customers for a significant portion of our net sales. • Our backlog figures may not accurately predict future sales. • There is a limited availability of sites suitable for cladding operations. • There is no assurance that we will continue to compete successfully against other manufacturers of competitive products. • Our costs could substantially increase if we experience a large claim or a significant number of warranty claims. 13 Table of Contents Risk Factors Related to our Businesses Generally • Our efforts to grow and transform our businesses may require significant investments; if our strategies are unsuccessful, our business, results of operations and/or financial condition may be materially adversely affected. • Our operations are subject to political and economic instability and risk of government actions that could have a material adverse effect on our business, consolidated results of operations, and consolidated financial condition. • Inflation and elevated interest rates have, and may continue to, adversely affect our financial position and results of operations. • Our business, financial condition and results of operations could be adversely affected by disruptions in the global and European economies caused by the ongoing conflict between Russia and Ukraine and instability in the Middle East. • Our operating results fluctuate from quarter to quarter. • We are exposed to potentially volatile fluctuations of the U.S. dollar (our reporting currency) against the currencies of many of our operating subsidiaries. • Disruptions or delays involving our suppliers or increases in prices for the components, raw materials and parts that we obtain from our suppliers could have a material adverse effect on our business and consolidated results of operations. • The terms of our indebtedness contain a number of restrictive covenants, the breach of any of which could result in acceleration of payment of our credit facilities. • If our customers delay paying or fail to pay a significant amount of our outstanding receivables, it could have a material adverse effect on our liquidity, consolidated results of operations, and consolidated financial condition. • New or existing tariffs and other trade measures could adversely affect our results of operations, financial position and cash flows. • Failure to attract and retain key personnel and source sufficient labor could adversely affect our current operating results. • Changes in immigration laws or enforcement programs could adversely affect our business. • A failure in our information technology systems or those of third parties, including those caused by security breaches, cyber-attacks or data protection failures, could disrupt our business, result in significant legal costs and other losses and damage our reputation. • Artificial intelligence presents risks and challenges that could adversely affect our business. • Failure to establish and maintain adequate internal controls over financial reporting could result in the inability to report our financial results in a timely and reliable manner, which could harm our business and impact the value of our securities.
We continuously evaluate opportunities for growth and change. These initiatives may involve making acquisitions, entering into partnerships and joint ventures, divesting assets, restructuring our existing operations and assets, creating new financial structures and building new facilities—any of which could require a significant investment and subject us to new risks. We may incur additional indebtedness to finance these opportunities.
These initiatives may involve making acquisitions, entering into partnerships and joint ventures, divesting assets, restructuring our existing operations and assets, creating new financial structures and building new facilities, any of which could require a significant investment and subject us to new risks. We may incur additional indebtedness to finance these opportunities.
Patent litigation, if necessary or when instituted against us, could result in substantial costs and divert our management’s attention and resources. 34 Table of Contents We may incur substantial costs defending against third parties alleging that we infringe their proprietary rights.
Patent litigation, if necessary or when instituted against us, could result in substantial costs and divert our management’s attention and resources. We may incur substantial costs defending against third parties alleging that we infringe their proprietary rights.
The success of any acquisition depends on a number of factors, including, but not limited to: • identifying suitable candidates for acquisition and negotiating acceptable terms; • obtaining approval from regulatory authorities and potentially DMC’s shareholders; • maintaining our financial and strategic focus and avoiding distraction of management during the process of integrating the acquired business; • implementing our standards, controls, procedures and policies at the acquired business and addressing any pre-existing liabilities or claims involving the acquired business; • our ability to realize the expected tax treatment or tax benefits from the transaction; and • to the extent the acquired operations are in a country in which we have not operated historically, understanding the regulations and challenges of operating in that new jurisdiction.
The success of any acquisition depends on a number of factors, including, but not limited to: • identifying suitable candidates for acquisition and negotiating acceptable terms; • obtaining approval from regulatory authorities and potentially DMC’s shareholders; • maintaining our financial and strategic focus and avoiding distraction of management during the process of integrating the acquired business; • securing adequate financing on acceptable terms; • implementing our standards, controls, procedures and policies at the acquired business and addressing any pre-existing liabilities or claims involving the acquired business; • retaining key employees, customers and business partners of the acquired business; • our ability to realize the expected tax treatment or tax benefits from the transaction; and 32 Table of Contents • to the extent the acquired operations are in a country in which we have not operated historically, understanding the regulations and challenges of operating in that new jurisdiction.
Our year-end backlog was $48.9 million, $59.4 million, and $55.5 million at the end of fiscal years 2024, 2023 and 2022, respectively. We define “backlog” at any given point in time to consist of all firm, unfulfilled purchase orders and commitments at that time. We expect to fill most items in backlog within the following twelve months.
Our year-end backlog was $62.6 million, $48.9 million, and $59.4 million at the end of fiscal years 2025, 2024, and 2023, respectively. We define “backlog” at any given point in time to consist of all firm, unfulfilled purchase orders and commitments at that time. We expect to fill most items in backlog within the following twelve months.
Debt financing would also be required to be repaid regardless of our operating results. Obtaining financing through issuances of common stock would impose fewer restrictions on our future operations but would be dilutive to the interests of existing stockholders.
Debt financing would also be required to be repaid regardless of our operating results. Obtaining financing through issuances of equity securities would impose fewer restrictions on our future operations but would be dilutive to the interests of existing stockholders.
Metals prices affect the demand for cladded products and our margins, with higher metal prices generally increasing demand for use of cladded materials over solid metals, which leads to higher sales (in terms of dollars rather than square meters of cladding) and generally higher margins for NobelClad.
Metals prices affect the demand for cladded products and our margins, with higher metal prices generally increasing demand for use of cladded materials over solid metals, which leads to higher sales (in terms of dollars rather than square meters of cladding) and generally higher margins for NobelClad. Our business is subject to volatility in metal prices and tariffs.
On June 5, 2024, the Company entered into a Stockholder Protection Rights Agreement (the "Rights Agreement"), pursuant to which the Board declared a dividend of one right ("Right") for each share of our common stock outstanding at the close of business on June 17, 2024.
On June 5, 2024, the Company entered into a Stockholder Protection Rights Agreement (as amended, the “Rights Agreement”), pursuant to which the Board declared a dividend of one right (“Right”) for each share of our common stock outstanding at the close of business on June 17, 2024.
With respect to any particular country, these risks may include: • political, social and economic instability; • civil unrest, acts of terrorism, force majeure, war, other armed conflict; • public health crises and catastrophic events; • inflation; • currency fluctuations, devaluations, conversion, or repatriation restrictions; • expropriation and nationalization of our assets; • confiscatory taxation or other adverse tax policies; • theft of, or lack of sufficient legal protection for, proprietary technology and other intellectual property; • limitations on extraction of shale gas or oil using hydraulic fracturing; • limitations on or disruptions to our markets or operations, restrictions on payments, or limitations on the movement of funds; • increased tariffs; • trade and economic sanctions or other restrictions; • unexpected changes in legal and regulatory requirements, including changes in interpretation or enforcement of existing laws; • deprivation of contract rights; and • the inability to obtain or retain licenses required for operation. 25 Table of Contents Inflation and higher interest rates have, and may continue to, adversely affect our financial position and results of operations.
With respect to any particular country, these risks may include: • political, social and economic instability; • civil unrest, acts of terrorism, force majeure, war, or other armed conflict; • public health crises and catastrophic events; • inflation; • currency fluctuations, devaluations, conversion, or repatriation restrictions; • expropriation and nationalization of our assets; • confiscatory taxation or other adverse tax policies; • theft of, or lack of sufficient legal protection for, proprietary technology and other intellectual property; • limitations on extraction of shale gas or oil using hydraulic fracturing; • limitations on or disruptions to our markets or operations, restrictions on payments, or limitations on the movement of funds; • increased tariffs, quotas, duties, or other adverse changes to trade policy; • economic sanctions or other restrictions; • unexpected changes in legal and regulatory requirements, including changes in interpretation or enforcement of existing laws; • deprivation of contract rights; and • the inability to obtain or retain licenses required for operation.
In addition, the CPRA expands consumers’ rights and has enhanced enforcement mechanisms such as the creation of a California Privacy Protection Agency that will investigate and enforce the CPRA and its promulgating regulations. The states of Virginia, Colorado, Connecticut and Utah have also recently enacted omnibus data privacy laws.
In addition, the CPRA expands consumers’ rights and has enhanced enforcement mechanisms such as the creation of a California Privacy Protection Agency that will investigate and enforce the CPRA and its promulgating regulations. Several states have also enacted omnibus data privacy laws.
This conflict has led and may continue to lead to significant market and other disruptions, including significant volatility in commodity prices and supply of energy resources, instability in financial markets, higher inflation, supply chain interruptions, increased costs for transportation and raw materials, political and social instability, as well as an increase in cyberattacks and espionage.
These conflicts have also led and may continue to lead to significant market and other disruptions, including significant volatility in commodity prices and supply of energy resources, instability in financial markets, higher inflation, supply chain interruptions, increased costs for transportation and raw materials, political and social instability, as well as an increase in cyberattacks and espionage.
Risk Factors Related to Arcadia Products • North American and global economic and industry-related business conditions materially affect our sales and results of operations. • We may not be able to continue to compete successfully against other companies in our industry. • If we are unable to manage our supply chain effectively, including availability and price of materials used in our products, our results of operations will be negatively affected. • An inability to successfully develop new products or improve existing products could negatively impact our ability to attract new customers and/or retain existing customers. • Product quality issues and product liability claims could adversely affect our operating results. • We recently implemented a new enterprise resource planning (ERP) system, and challenges with the implementation of the system may adversely impact our business and operations.
Risk Factors Related to Arcadia Products • North American and global economic and industry-related business conditions materially affect our sales and results of operations. • We may not be able to continue to compete successfully against other companies in our industry. • If we are unable to manage our supply chain effectively, including availability and price of materials used in our products, our results of operations will be negatively affected. • An inability to successfully develop new products or improve existing products could negatively impact our ability to attract new customers and/or retain existing customers. • Product quality issues and product liability claims could adversely affect our operating results.
Sales made in currencies other than U.S. dollars accounted for 11%, 9%, and 6% of total sales for the years ended 2024, 2023 and 2022, respectively.
Sales made in currencies other than U.S. dollars accounted for 10%, 11%, and 9% of total sales for the years ended 2025, 2024, and 2023, respectively.
Further escalation of geopolitical tensions related to this military conflict and/or its expansion could result in loss of property, expropriation, cyberattacks, supply disruptions, plant closures and an inability to obtain key supplies and materials, as well as adversely affect both our and our customers' supply chains and logistics, particularly in Europe.
Further escalation of geopolitical tensions related to these conflicts and/or their expansion could result in loss of property, expropriation, cyberattacks, supply disruptions, plant closures and an inability to obtain key supplies and materials, as well as adversely affect both our and our customers’ supply chains and logistics, particularly in Europe.
Violations of international and U.S. laws and regulations or the loss of any required licenses may result in fines and penalties, criminal sanctions, administrative remedies or restrictions on business conduct, and could have a material adverse effect on our business, operations and financial condition.
Violations of international and U.S. laws and regulations or the loss of any required licenses, even if in violation of our internal controls, policies, and procedures, may result in fines and penalties, criminal sanctions, administrative remedies or restrictions on business conduct, and could have a material adverse effect on our business, operations and financial condition.
We are dependent upon information technology systems in the conduct of our operations. Our information technology systems are subject to disruption, damage or failure from a variety of sources, including, without limitation, computer viruses, security breaches, cyber-attacks, natural disasters and defects in design.
Our information technology systems are subject to disruption, damage or failure from a variety of sources, including, without limitation, computer viruses, security breaches, cyber-attacks, natural disasters and defects in design.
There is also increased focus, including by governments and our customers, investors and other stakeholders, on these and other sustainability and energy transition matters.
There is also increased focus, including by governments and our customers, investors and other 27 Table of Contents stakeholders, on these and other sustainability and energy transition matters.
Although the increase in the 2024 amended credit facility was intended to allow us to finance the Option Purchase Price, a potential exercise will depend on numerous factors, including the performance of our businesses, the status of any changes to our businesses and general market and economic conditions.
Although the credit facility amendments were intended to allow us to finance the Option Purchase Price, a potential exercise will depend on numerous factors, including the performance of our businesses, the status of any changes to our businesses and general market and economic conditions.
The terms of our indebtedness contain a number of restrictive covenants, the breach of any of which could result in acceleration of payment of our credit facilities. As of December 31, 2024, we had an outstanding balance of $72.5 million on our syndicated credit agreement, which was amended on February 6, 2024.
The terms of our indebtedness contain a number of restrictive covenants, the breach of any of which could result in acceleration of payment of our credit facilities. As of December 31, 2025, we had an outstanding balance of $52.0 million on our syndicated credit agreement, which was amended on February 6, 2024, and June 10, 2025.
If any of our key suppliers are unable to meet their commitments, or if those supply arrangements are terminated, we may not be able to obtain certain raw materials on commercially reasonable terms or at all, and may suffer a significant interruption in our ability to manufacture our products, including because it may be difficult to find substitute or alternate suppliers as the aluminum extrusions we use are customized.
If any of our key suppliers are unable to meet their commitments, or if those supply arrangements are terminated, we may not be able to obtain certain raw materials on commercially reasonable terms or at all, and may suffer a significant interruption in our ability to manufacture our products, including because it may be difficult to find substitute or alternate suppliers as the aluminum extrusions we use are customized. 15 Table of Contents We could also be required to maintain higher inventory levels as we address supply uncertainties.
Legal and Regulatory Risks • Our operations require us to comply with numerous laws and regulations, violations of which could have a material adverse effect on our consolidated results of operations, financial condition or cash flows. • The use of explosives in our DynaEnergetics and NobelClad manufacturing processes and products subject us to additional environmental, health and safety laws and any accidents or injuries could subject us to significant liabilities. • Demand for our products could be reduced by existing and future legislation, regulations and public sentiment. • We are subject to extensive environmental, health and safety laws and failure to comply with such laws and regulations could result in restrictions or prohibitions on our facilities, substantial civil or criminal liabilities and could have a material adverse effect on our business, consolidated results of operations, and consolidated financial condition. • Failure to comply with applicable federal, state and local employment and labor laws and regulations could have a material, adverse impact on our business. • The regulatory environment governing information, data security and privacy is increasingly demanding and evolving and a data security breach could result in litigation, enforcement actions and related penalties and fines. • Legal, regulatory or market measures to address climate change, including proposals to restrict emissions of GHGs and other sustainability initiatives, could have an adverse impact on the Company’s business and results of operations. • Changes in or interpretation of tax law could impact the determination of our income tax liabilities for a tax year.
Legal and Regulatory Risks • Our operations require us to comply with numerous laws and regulations, violations of which could have a material adverse effect on our consolidated results of operations, financial condition or cash flows. • The use of explosives in our DynaEnergetics and NobelClad manufacturing processes and products subject us to additional environmental, health and safety laws and any accidents or injuries could subject us to significant liabilities. • Demand for our products could be reduced by existing and future legislation, regulations and public sentiment. • We are subject to extensive environmental, health and safety laws and failure to comply with such laws and regulations could result in restrictions or prohibitions on our facilities, substantial civil or criminal liabilities and could have a material adverse effect on our business, consolidated results of operations, and consolidated financial condition. • Failure to comply with applicable federal, state and local employment and labor laws and regulations could have a material, adverse impact on our business. • The regulatory environment governing information, data security and privacy is increasingly demanding and evolving and a data security breach could result in litigation, enforcement actions and related penalties and fines.
The construction industry is impacted by macroeconomic trends, such as availability of credit, employment levels, consumer confidence, interest rates and commodity prices. Recent rising inflation, interest rates, and construction costs have reduced, and could continue to reduce, the demand for our products and impact our profitability.
The construction industry is impacted by macroeconomic trends, such as availability of credit, employment levels, consumer confidence, interest rates and commodity prices. Continued inflationary pressure, a high-interest rate environment, and rising construction costs have reduced, and could continue to reduce, the demand for our products and impact our profitability.
We are continuing to experience significant customer concentration and customer consolidation, resulting in certain customers having substantial negotiating leverage, which has negatively impacted our pricing, margins and profitability. During the year ended December 31, 2024, one DynaEnergetics customer accounted for approximately 23% of consolidated net sales of the Company.
We are continuing to experience significant customer concentration and customer consolidation, resulting in certain customers having substantial negotiating leverage, which has negatively impacted our pricing, margins and profitability, as well as increasing accounts receivable concentration among fewer customers. During the year ended December 31, 2025, one DynaEnergetics customer accounted for approximately 26% of consolidated net sales of the Company.
We could also be required to maintain higher inventory levels as we address supply uncertainties. Such developments would result in higher costs and potentially a decrease in our revenues and profitability. If our supply of raw materials is disrupted or our delivery times are extended, our results of operations and financial condition could be materially adversely affected.
Such developments would result in higher costs and potentially a decrease in our revenues and profitability. If our supply of raw materials is disrupted or our delivery times are extended, our results of operations and financial condition could be materially adversely affected.
DMC is the majority shareholder of Arcadia Products, and our interest in Arcadia Product s is subject to the risks normally associated with the conduct of businesses with a minority shareholder.
DMC is the majority shareholder of Arcadia Products, and our interest in Arcadia Product s is subject to the risks normally associated with the conduct of businesses with a minority shareholder. Munera continues to hold 40% of the outstanding equity interests of Arcadia Products.
From time to time, our business has engaged in strategic initiatives, and such activities may occur in the future. These efforts have recently included a series of automation, lean manufacturing and cost-reduction initiatives designed to enhance profitability and improve quality.
From time to time, our business has engaged in strategic initiatives, and such activities may occur in the future. These efforts have included a series of automation, lean manufacturing and cost-reduction initiatives designed to enhance profitability and improve quality. We may not realize the full benefits expected within the anticipated timeframe.
These trade regulations and laws can include restrictions on selling or importing goods, services or technology in or from affected regions, travel bans and asset freezes impacting connected individuals and political, military, business and financial organizations and can change very quickly, such as has occurred in connection with Russia’s invasion of Ukraine.
These trade regulations and laws can include restrictions on selling or importing goods, services or technology in or from affected regions, travel bans and asset freezes impacting connected individuals and political, military, business and financial organizations and can change very quickly.
Our ability to service the indebtedness under the credit facility and to maintain compliance with its covenants, which are based in part on trailing twelve-month results, will depend on our success in achieving the intended benefits of the acquisition and are subject to numerous risks and uncertainties as discussed above.
Our ability to service the indebtedness under the credit facility and to maintain compliance with its covenants, which are based in part on trailing twelve-month results, are subject to numerous risks and uncertainties as discussed herein.
In addition, higher interest rates in the U.S. have increased the cost of debt, investment, and construction costs. Higher interest rates make it more expensive for our customers to finance projects in certain of our business segments, and as a result, may continue to reduce the demand for our products and impact our profitability.
Although interest rates have moderated from recent highs, they remain elevated, which has increased the cost of debt, investment, and construction costs. Higher interest rates make it more expensive for our customers to finance projects in certain of our business segments, and as a result, may continue to reduce the demand for our products and impact our profitability.
Various legislative, regulatory, and inter-governmental proposals to restrict emissions of GHGs, such as carbon dioxide (“CO2”), are under consideration by governmental legislative bodies and regulators in the jurisdictions where we operate.
Various legislative, regulatory, and inter-governmental proposals to restrict emissions of greenhouse gas, such as carbon dioxide, are under consideration, or have already passed into law, by governmental legislative bodies and regulators in the jurisdictions where we operate.
Any failure to remain in compliance with any material provision or covenant of our credit agreement could result in a default, which would, absent a waiver or amendment, require immediate repayment of outstanding indebtedness under our credit facilities.
Any failure to remain in compliance with any material provision or covenant of our credit agreement could result in a default, which would, absent a waiver or amendment, require immediate repayment of outstanding indebtedness under our credit facilities. We may not have or be able to obtain sufficient funds to satisfy such a repayment obligation.
In addition, any major violations could have a significant effect on our reputation and consequently on our ability to win future business and maintain existing customer and supplier relationships.
In addition, any actual or alleged violations could have a significant effect on our reputation, be expensive to defend and impair our ability to win future business and maintain existing customer and supplier relationships.
We expect that shortages in supply and increases in costs of natural gas or other energy will adversely impact our ability to operate our German manufacturing facilities as efficiently and cost-effectively as previously, which could adversely affect our business, results of operations and financial condition. Our operating results fluctuate from quarter to quarter.
We expect that shortages in supply and increases in costs of natural gas or other energy will adversely impact our ability to operate our German manufacturing facilities as efficiently and cost-effectively as previously, which could adversely affect our business, results of operations and financial condition. In addition, conflicts in the Middle East have disrupted both maritime and air transportation.
Changes in or new interpretations of existing laws, regulations or enforcement policies, the discovery of previously unknown contamination, or the imposition of other environmental liabilities or obligations in the future including additional investigation, remediation or other obligations with respect to our products or business activities may lead to additional compliance costs or require us to change our manufacturing processes, which could have a material adverse effect on our business, financial condition or results of operations. 31 Table of Contents In Germany, we and all our activities are subject to various safety and environmental regulations of the federal state which are enforced by the local authorities, including the Federal Act on Emission Control (Bundes-Immissionsschutzgesetz).
Changes in or new interpretations of existing laws, regulations or enforcement policies, the discovery of previously unknown contamination, or the imposition of other environmental liabilities or obligations in the future including additional investigation, remediation or other obligations with respect to our products or business activities may lead to additional compliance costs or require us to change our manufacturing processes, which could have a material adverse effect on our business, financial condition or results of operations.
The implementation of strategies for growth and change may create additional risks, including: ● diversion of management time and attention away from existing operations; ● requiring capital investment that could otherwise be used for the operation and growth of our existing businesses; ● disruptions to important business relationships; ● increased operating costs; ● limitations imposed by various governmental entities; and ● difficulties due to lack of or limited prior experience in any new markets we may enter.
If our strategies for growth and change are not successful, we could face increased financial pressure, such as increased cash flow demands, reduced liquidity and diminished access to financial markets, and the equity value of our businesses could be diluted. 20 Table of Contents The implementation of strategies for growth and change may create additional risks, including: • diversion of management’s time and attention away from existing operations; • requiring capital investment that could otherwise be used for the operation and growth of our existing businesses; • disruptions to important business relationships; • increased operating costs; • limitations imposed by various governmental entities; and • difficulties due to lack of or limited prior experience in any new markets we may enter.
Increases in the cost of wages, materials, parts, equipment, transportation and other operational components over the past two years have adversely affected our results of operations, cash flows and financial position by increasing our overall cost structure, and could continue to do so, particularly if we are unable to achieve commensurate increases in the prices we charge our customers for our products.
This has adversely affected our results of operations, cash flows and financial position by increasing our overall cost structure, and could continue to do so, particularly if we are unable to achieve commensurate increases in the prices we charge our customers for our products.
Demand for DynaEnergetics products could be reduced by existing and future legislation, regulations and public sentiment. Regulatory agencies and environmental advocacy groups in the United States, the E.U., and other regions or countries have been focusing considerable attention on emissions of carbon dioxide, methane and other greenhouse gases and their role in climate change.
Regulatory agencies and environmental advocacy groups in the United States, the E.U., and other regions or countries have been focusing considerable attention on emissions of carbon dioxide, methane and other greenhouse gases and their role in climate change.
The guidelines suggest a tougher stance on enforcement and stiffer fines for companies that violate the GDPR. This is in addition to the continued complexities involving the transfer of personal data from Europe to the U.S. following the Schrems II decision.
Internationally, the European Data Protection Board has released guidelines on enforcement and fines related to the General Data Protection Regulation (“GDPR”). The guidelines suggest a tougher stance on enforcement and stiffer fines for companies that violate the GDPR. This is in addition to the continued complexities involving the transfer of personal data from Europe to the U.S.
Risk Factors Related to Our Common Stock The price and trading volume of our common stock may be volatile, which may make it difficult for you to resell the common stock when you want or at prices you find attractive.
Risk Factors Related to Our Common Stock The price and trading volume of our common stock has been and may continue to be volatile, which may make it difficult for investors to resell the common stock at attractive timing or pricing.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeDMC’s Chief Information Officer (CIO) and Chief Information Security Officer (CISO), the management position responsible for assessing and managing material risks from cybersecurity threats, manages the Company’s cybersecurity program and are responsible for leading and coordinating cybersecurity activities across the organization.
Biggest changeITEM 1C. Cybersecurity The Board, in coordination with the Risk Committee, oversees the Company’s risk management program, which includes risks arising from cybersecurity threats. DMC’s Chief Information Officer (“CIO”), the management position responsible for assessing and managing material risks from cybersecurity threats, manages the Company’s cybersecurity program and is responsible for leading and coordinating cybersecurity activities across the organization.
These reports are typically presented by our CISO to the Risk Committee of the Board and include updates to recently completed cybersecurity initiatives, upcoming plans, an overview of current threats, as well as discussion of our overall cybersecurity maturity and readiness.
These reports are typically presented by our CIO to the Risk Committee of the Board and include updates to recently completed cybersecurity initiatives, upcoming plans, an overview of current threats, as well as discussion of our overall cybersecurity maturity and readiness.
However, we recognize the ever-evolving cyber risk landscape and cannot provide any assurances that we will not be subject to a material cybersecurity incident in the future. See Item 1A.
However, we recognize the ever-evolving cyber risk landscape and cannot provide any assurances that we will not be subject to a material cybersecurity incident in the future. Refer to Item 1A.
Risk Factors “A failure in our information technology systems or those of third parties, including those caused by security breaches, cyber-attacks or data protection failures, could disrupt our business, result in significant legal costs and other losses and damage our reputation” for a discussion of cybersecurity-related risks.
Risk Factors “A failure in our information technology systems or those of third parties, including those caused by security breaches, cyber-attacks or data protection failures, could disrupt our business, result in significant legal costs and other losses and damage our reputation” for a discussion of cybersecurity-related risks. 35 Table of Contents
The Board participates in simulated cybersecurity trainings and is kept apprised of changes in cybersecurity regulatory requirements, ensuring that our organization remains in compliance with relevant standards. Cybersecurity risks and threats, including as a result of any previous cybersecurity incidents, have not materially impacted and are not reasonably expected to materially impact us or our operations.
The Board has also participated in simulated cybersecurity trainings and is kept apprised of changes in cybersecurity regulatory requirements, ensuring that our organization remains in compliance with relevant standards. Cybersecurity risks and threats, including as a result of any previous cybersecurity incidents, have not materially impacted and are not reasonably expected to materially impact us or our operations.
The CIO reports directly to our Interim President and Chief Executive Officer, and the CISO reports directly to our CIO. Our CISO has extensive experience in cybersecurity, business continuity, disaster recovery and cloud security. Led by our CIO and CISO, we conduct regular assessments to identify potential cybersecurity risks and vulnerabilities, including the evaluation of systems and data assets.
The CIO reports directly to our Chief Financial Officer. Our CIO has extensive experience in cybersecurity, business continuity, disaster recovery and cloud security. Led by our CIO, we conduct regular assessments to identify potential cybersecurity risks and vulnerabilities, including the evaluation of systems and data assets.
We have established an incident response policy that outlines the process for assessing and responding to cybersecurity incidents. The incident response policy is reviewed at least annually by executive management. The Board also receives quarterly updates on cybersecurity risks.
We have established a Cybersecurity Incident Response Plan that outlines the process for assessing and responding to cybersecurity incidents. The Board also receives quarterly updates on cybersecurity risks.
To further evaluate our cybersecurity defenses, we periodically commission penetration exercises conducted by specialized firms. These tests simulate real-world attacks and assist in assessing our internal readiness and response capabilities. We are proactively taking steps to enhance our monitoring of third-party service providers’ cybersecurity, including the continuance of a vendor third-party risk management program.
To further evaluate our cybersecurity defenses, we periodically commission penetration exercises conducted by specialized firms. These tests simulate real-world attacks and assist in assessing our internal readiness and response capabilities. Cybersecurity risk updates are provided quarterly to our senior management team by the CIO as part of our enterprise risk management process.
Removed
ITEM 1C. Cybersecurity The Board, in coordination with the Risk Committee, oversees the Company's risk management program, which includes risks arising from cybersecurity threats.
Removed
As we continue to expand this program, it should better enable the Company to identify and manage material risks from cybersecurity threats related to our third-party service providers. Cybersecurity risk updates are provided quarterly to our senior management team by the CIO and CISO as part of our enterprise risk management process.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe table below summarizes DynaEnergetics' material properties, including their location, type, size, whether owned or leased and expiration terms, if applicable. Location Property Type Property Size Owned/Leased Expiration Date of Lease (if applicable) Troisdorf, Germany Manufacturing and administration office Manufacturing: 263,201 sq. ft. Office: 2,033 sq. ft. Leased December 31, 2025 Troisdorf, Germany Office 4,672 sq. ft.
Biggest changeDynaEnergetics also leases office and warehouse space and bunkers for storage of its explosives in Alberta, Canada. The table below summarizes DynaEnergetics’ material properties, including their location, type, size, whether owned or leased and expiration terms, if applicable, as of December 31, 2025, unless otherwise noted.
ITEM 2. Properties Corporate Headquarters Our corporate headquarters currently are located in Broomfield, Colorado. The office is also used for NobelClad’s U.S. administrative offices. Location Property Type Property Size Owned/Leased Expiration Date of Lease (if applicable) Broomfield, Colorado Corporate and Sales Office 18,284 sq. ft.
ITEM 2. Properties Corporate Headquarters Our corporate headquarters currently are located in Broomfield, Colorado. The office is also used for NobelClad’s U.S. administrative offices. Location Property Type Approximate Property Size Owned/Leased Expiration Date of Lease (if applicable) Broomfield, Colorado Corporate and Sales Office 18,000 sq. ft.
Leased September 30, 2029, with renewal option for 60 months 38 Table of Contents Arcadia Products Arcadia Products owns a manufacturing site and sales office in Vernon, California and leases other manufacturing and distribution centers throughout the United States.
Leased September 30, 2029, with renewal option for 60 months Arcadia Products Arcadia Products owns a manufacturing site and sales office in Vernon, California and leases other manufacturing and distribution centers throughout the United States.
NobelClad leases the building housing its sales and administrative office in Perpignan, France. The table below summarizes NobelClad's material properties, including their location, type, size, whether owned or leased and expiration terms, if applicable. Location Property Type Property Size Owned/Leased Expiration Date of Lease (if applicable) Mt.
NobelClad leases the building housing its sales and administrative office in Perpignan, France. 37 Table of Contents The table below summarizes NobelClad’s material properties, including their location, type, size, whether owned or leased and expiration terms, if applicable, as of December 31, 2025. Location Property Type Approximate Property Size Owned/Leased Expiration Date of Lease (if applicable) Mt.
Owned Blum, Texas Land for office, warehouse, and manufacturing 284 acres Owned Midland, Texas Land 13.3 acres Leased April 1, 2029 Whitney, Texas Warehouse Building: 30,000 sq ft Land: 3.816 acres Leased October 31, 2029 Whitney, Texas Office, warehouse, and manufacturing 36,000 sq. ft. Owned Alberta, Canada Office and warehouse 7,650 sq. ft.
Owned Blum, Texas Land for office, warehouse, and manufacturing 284 acres Owned Midland, Texas Land 13 acres Leased April 1, 2029 Whitney, Texas Warehouse Building: 30,000 sq ft Land: 4 acres Leased October 31, 2029 Whitney, Texas Office, warehouse, and manufacturing 36,000 sq. ft. Owned Alberta, Canada Office and warehouse 8,000 sq. ft.
Leased December 22, 2026, with renewal option for 60 months Vernon, California (1) Office, warehouse 110,677 sq. ft. Leased December 22, 2026, with renewal option for 60 months Hayward, California (1) Distribution, light assembly 45,624 sq. ft. Leased December 22, 2027 West Sacramento, California (1) Distribution, light assembly 16,000 sq. ft.
Leased December 22, 2026, with renewal option for 60 months Vernon, California (1) Office, warehouse 111,000 sq. ft. Leased December 22, 2026, with renewal option for 60 months Hayward, California (1) Distribution, light assembly 46,000 sq. ft. Leased December 22, 2027 West Sacramento, California (1) Distribution, light assembly 16,000 sq. ft.
Owned Land for office, paint shop, anodizing line 0.8 acre Owned Land for office, paint shop, anodizing line 2.24 acres Leased May 31, 2046 Vernon, California Land for parking 39,545 sq. ft. Leased March 31, 2027 Vernon, California (1) Office, paint shop 112,000 sq. ft.
Owned Land for office, paint shop, anodizing line 1 acre Owned Land for office, paint shop, anodizing line 2 acres Leased May 31, 2046 Vernon, California Land for parking 40,000 sq. ft. Leased March 31, 2027 Vernon, California (1) Office, paint shop 112,000 sq. ft.
The table below summarizes Arcadia Products' material properties, including their location, type, size, whether owned or leased and expiration terms, if applicable. Location Property Type Property Size Owned/Leased Expiration Date of Lease (if applicable) Vernon, California Corporate office, metal shop building, warehouse 26,500 sq. ft.
The table below summarizes Arcadia Products’ material properties, including their location, type, size, whether owned or leased and expiration terms, if applicable, as of December 31, 2025. Location Property Type Approximate Property Size Owned/Leased Expiration Date of Lease (if applicable) Vernon, California Corporate office, metal shop building, warehouse 27,000 sq. ft.
Leased December 31, 2027 South Gate, California Office, manufacturing, storage Building: 25,000 sq. ft. Land: 45,000 sq. ft. Leased April 30, 2027 Houston, Texas Office, warehouse 43,412 sq. ft. Leased November 30, 2028, with renewal option for 60 months Dallas, Texas Office, warehouse 86,731 sq. ft.
Leased December 31, 2027 South Gate, California Office, manufacturing, storage Building: 25,000 sq. ft. Land: 45,000 sq. ft. Leased April 30, 2027 Houston, Texas Office, warehouse 43,000 sq. ft. Leased November 30, 2028, with renewal option for 60 months Dallas, Texas Office, warehouse 87,000 sq. ft. Leased December 31, 2028 Kent, Washington Distribution, light assembly 25,000 sq. ft.
The shooting site in Dunbar and the nearby secondary shooting site support our Mount Braddock facility. The lease for the Dunbar property will expire on May 6, 2029, but we have options to renew the lease which would then extend through May 6, 2054.
We currently lease our domestic cladding site located in Dunbar, Pennsylvania to support our Mount Braddock facility. The lease for the Dunbar property will expire on May 6, 2029, but we have options to renew the lease which would then extend through May 6, 2054.
Braddock, Pennsylvania Clad plate manufacturing and administration office Land: 14 acres Buildings: 101,300 sq. ft. Owned Dunbar, Pennsylvania Clad plate shooting site Land: 322 acres Buildings: 15,960 sq. ft. Leased May 6, 2029 with renewal options through May 6, 2054. Cool Spring, Pennsylvania Clad plate shooting site 1,200,000 sq. ft.
Braddock, Pennsylvania Clad plate manufacturing and administration office Land: 14 acres Buildings: 101,000 sq. ft. Owned Dunbar, Pennsylvania Cladding site Land: 322 acres Buildings: 16,000 sq. ft. Leased May 6, 2029, with renewal options through May 6, 2054.
Leased December 22, 2026, with renewal option for 24 months Tucson, Arizona (1) Office, paint shop, warehouse 106,507 sq. ft. Leased December 22, 2026, with renewal option for 60 months Waipahu, Hawaii Distribution, light assembly Building: 12,746 sq. ft. Land: 21,872 sq. ft. Leased May 31, 2028 South Gate, California Office, manufacturing 45,700 sq. ft.
Leased December 22, 2026, with renewal option for 24 months Tucson, Arizona (1) Office, paint shop, warehouse 107,000 sq. ft. Leased December 22, 2026, with renewal option for 60 months Waipahu, Hawaii Distribution, light assembly Building: 13,000 sq. ft. Land: 22,000 sq. ft. Leased May 31, 2028 South Gate, California Office, manufacturing 46,000 sq. ft.
Leased December 22, 2027 Stamford, Connecticut (1) Office, warehouse 39,418 sq. ft. Leased December 22, 2025 Phoenix, Arizona (1) Office, warehouse 51,986 sq. ft. Leased December 22, 2026, with renewal option for 24 months Las Vegas, Nevada (1) Office, warehouse 88,915 sq. ft.
Leased December 22, 2027 Stamford, Connecticut (1) Office, warehouse 39,000 sq. ft. Leased December 22, 2026, with renewal option for 12 months Phoenix, Arizona (1) Office, warehouse 52,000 sq. ft. Leased December 22, 2026, with renewal option for 24 months Las Vegas, Nevada (1) Office, warehouse 89,000 sq. ft.
Leased February 28, 2027 Liebenscheid, Germany Manufacturing and office 5,511 sq. ft. Owned Liebenscheid, Germany Land 77,672 sq. ft. Owned Houston, Texas Office 11,370 sq. ft. Leased November 30, 2026 Blum, Texas Office, warehouse, and manufacturing 83,000 sq. ft. Owned Blum, Texas (a) Warehouse 10,000 sq. ft.
Owned Houston, Texas Office 11,000 sq. ft. Leased November 30, 2026 Blum, Texas Office, warehouse, and manufacturing 83,000 sq. ft. Owned Blum, Texas (2) Warehouse 10,000 sq. ft.
Leased August 31, 2025 (a) The Blum, Texas warehouse is separate from the main Blum manufacturing campus. 40 Table of Contents NobelClad NobelClad owns its principal domestic manufacturing site, which is located in Mount Braddock, Pennsylvania.
Leased August 31, 2030 (1) Subsequent to December 31, 2025, this lease was extended effective January 1, 2026 through December 31, 2036. (2) The Blum, Texas warehouse is separate from the main Blum manufacturing campus. NobelClad NobelClad owns its principal domestic manufacturing site, which is located in Mount Braddock, Pennsylvania.
The license and risk allocation agreements will expire on March 31, 2028, with renewal options through March 31, 2033. NobelClad owns a manufacturing site in Liebenscheid, Germany as well as a mine used as a shooting site in Dillenburg, Germany. We purchased the buildings and land around the Dillenburg mine in 2022.
NobelClad owns a manufacturing site in Liebenscheid, Germany as well as a mine used as a cladding site in Dillenburg, Germany. We purchased the buildings and land around the Dillenburg mine in 2022.
During the year-ended December 31, 2024, DMC recorded $4,625 in lease expense related to these properties. 39 Table of Contents DynaEnergetics DynaEnergetics leases a manufacturing site and administration office in Troisdorf, Germany. The leases for this property expire on December 31, 2025, and we are negotiating future renewal options.
Leased May 31, 2029 (1) These leases are with entities affiliated with the holder of the redeemable noncontrolling interest holder and president of Arcadia Products. During the year ended December 31, 2025, DMC recorded $4,666 in lease expense related to these properties. 36 Table of Contents DynaEnergetics DynaEnergetics leases a manufacturing site and administration office in Troisdorf, Germany.
Leased March 31, 2028, with renewal options through March 31, 2033 Canonsburg, Pennsylvania Manufacturing 16,000 sq. ft Leased November 30, 2025, with renewal options for one additional 12-month periods Tautavel, France (a) Clad shooting site 116 acres Owned Perpignan, France Administration and sales office 3,671 sq. ft Leased September 30, 2029, with renewal options for additional three-year periods.
Lemont Furnace, Pennsylvania Manufacturing 16,000 sq. ft Leased November 30, 2027 Tautavel, France (1) Cladding site 116 acres Owned Perpignan, France Administration and sales office 4,000 sq. ft Leased September 30, 2029, with renewal options for additional three-year periods. Burbach-Würgendorf, Germany Storage 224 sq. meters Leased December 31, 2050 Dillenburg, Germany Cladding site Land: 19 acres Buildings: 46,000 sq. ft.
Burbach-Würgendorf, Germany Storage 224 sq. meters Leased December 31, 2050 Dillenburg, Germany Clad plate shooting site Land: 18.9 acres Buildings: 46,285 sq. ft. Owned Liebenscheid, Germany Manufacturing Land: 10.47 acres Buildings: 125,394 sq. ft. Owned (a) Though NobelClad is no longer performing manufacturing activities in France, it owns this land in order to have access to a redundant shooting site.
Owned Liebenscheid, Germany Manufacturing Land: 10 acres Buildings: 125,000 sq. ft. Owned (1) Though NobelClad is no longer performing manufacturing activities in France, it owns this land in order to have access to a redundant cladding site. ITEM 3. Legal Proceedings Refer to Note 13 “Commitments and Contingencies” within Part II, Item 8 — Financial Statements and Supplementary Data.
In the U.S., DynaEnergetics owns manufacturing and assembly sites in Texas and leases storage bunkers and office and warehouse space in various cities throughout Texas. DynaEnergetics also leases office and warehouse space and bunkers for storage of its explosives in Alberta, Canada.
Subsequent to December 31, 2025, the lease for this property was extended effective January 1, 2026, through December 31, 2036, with options to renew the lease which would then extend through December 31, 2046. In the U.S., DynaEnergetics owns manufacturing and assembly sites in Texas and leases storage bunkers and office and warehouse space in various cities throughout Texas.
Removed
Leased November 30, 2025, with renewal option for 60 months Kent, Washington Distribution, light assembly 25,000 sq. ft. Leased May 31, 2029 (1) These leases are with entities affiliated with the holder of the redeemable noncontrolling interest holder and president of Arcadia Products as of February 3, 2025.
Added
Location Property Type Approximate Property Size Owned/Leased Expiration Date of Lease (if applicable) Troisdorf, Germany (1) Manufacturing and administration office 85,000 sq.ft. Leased December 31, 2036, with renewal option for 120 months Troisdorf, Germany Office 5,000 sq. ft. Leased February 28, 2027 Liebenscheid, Germany Manufacturing and office 6,000 sq. ft. Owned Liebenscheid, Germany Land 78,000 sq. ft.
Removed
We currently lease our primary domestic shooting site, which is located in Dunbar, Pennsylvania, and we also have license and risk allocation agreements relating to the use of a secondary shooting site, Coolspring, that is located within a few miles of the Mount Braddock facility.
Added
ITEM 4. Mine Safety Disclosures Not applicable. 38 Table of Contents PART II
Removed
ITEM 3. Legal Proceedings Refer to Note 13 within Part II, Item 8 — Financial Statements and Supplementary Data.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Removed
ITEM 4. Mine Safety Disclosures Our Coolspring property is subject to regulation by the Federal Mine Safety and Health Administration ("MSHA") under the Federal Mine Safety and Health Act of 1977 (the "Mine Act").
Added
Item 4. Mine Safety Disclosures 38 Part II 39 Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 39 Item 6. [Reserved] 40 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 41 Item 7A. Quantitative and Qualitative Disclosures about Market Risk 54 Item 8.
Removed
Pursuant to Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act"), issuers that are operators, or that have a subsidiary that is an operator, of a coal or other mine in the United States are required to disclose in their periodic reports filed with the SEC information regarding specified health and safety violations, orders and citations, related assessments and legal actions, and mining-related fatalities.
Removed
During the year ended December 31, 2024, we had no such specified health and safety violations, orders or citations, related assessments or legal actions, mining-related fatalities, or similar events in relation to our United States operations requiring disclosure pursuant to Section 1503(a) of the Dodd-Frank Act. 41 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeTotal number of shares purchased (1) (2) Average price paid per share October 1 to October 31, 2024 13,948 $ 13.06 November 1 to November 30, 2024 3,776 $ 10.04 December 1 to December 31, 2024 3,231 $ 6.84 Total 20,955 $ 11.56 (1) Share purchases during the period were to offset tax withholding obligations that occurred upon the vesting of restricted common stock under the terms of the 2016 Equity Incentive Plan.
Biggest changeTotal number of shares purchased (1) (2) Average price paid per share October 1 to October 31, 2025 — $ — November 1 to November 30, 2025 72,348 $ 7.85 December 1 to December 31, 2025 — $ — Total 72,348 $ 7.85 (1) Share purchases during the period were to offset tax withholding obligations that occurred upon the vesting of restricted common stock under the terms of the 2016 Omnibus Incentive Plan and the 2025 Omnibus Incentive Plan, as applicable.
The comparison of total return (change in year-end stock price plus reinvested dividends) for each of the years assumes that $100 was invested on December 31, 2019, in each of the Company, the Nasdaq Non-Financial Stocks Index and the Nasdaq Composite (U.S.) Index with investment weighted on the basis of market capitalization.
The comparison of total return (change in year-end stock price plus reinvested dividends) for each of the years assumes that $100 was invested on December 31, 2020, in each of the Company, the Nasdaq Non-Financial Stocks Index and the Nasdaq Composite (U.S.) Index with investment weighted on the basis of market capitalization.
ITEM 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock is publicly traded on The Nasdaq Global Select Market (“Nasdaq”) under the symbol “BOOM.” As of February 17, 2025, there were 172 holders of record of our common stock (does not include beneficial holders of shares held in “street name”).
ITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock is publicly traded on The Nasdaq Global Select Market (“Nasdaq”) under the symbol “BOOM.” As of February 17, 2026, there were 165 holders of record of our common stock (does not include beneficial holders of shares held in “street name”).
(2) As of December 31, 2024, the maximum number of shares that could be purchased would not exceed the employees’ portion of taxes to be withheld on unvested shares (758,368) and potential purchases upon participant elections to diversify equity awards held in the Company’s Amended and Restated Non-Qualified Deferred Compensation Plan (35,838) into other investment options available to participants in the Plan. 42 Table of Contents Stock Performance Graph The following graph compares the performance of our common stock with the Nasdaq Non-Financial Stocks Index and the Nasdaq Composite (U.S.) Index.
(2) As of December 31, 2025, the maximum number of shares that could be purchased would not exceed the employees’ portion of taxes to be withheld on unvested shares (1,324,752) and potential purchases upon participant elections to diversify equity awards held in the deferred compensation plan (3,139) into other investment options available to participants in the Plan. 39 Table of Contents Stock Performance Graph The following graph compares the performance of our common stock with the Nasdaq Non-Financial Stocks Index and the Nasdaq Composite (U.S.) Index.
Equity Compensation Plan Refer to “Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters” for information regarding securities authorized for issuance under our equity compensation plans, which is incorporated in this Item by this reference. Issuer Purchases of Equity Securities During the quarter ended December 31, 2024, we purchased shares of common stock as follows.
Equity Compensation Plan Refer to “Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters” for information regarding securities authorized for issuance under our equity compensation plans, which is incorporated in this Item by this reference.
Removed
These shares are held as treasury shares by the Company.
Added
Issuer Purchases of Equity Securities During the quarter ended December 31, 2025, we purchased shares of our common stock as follows. These shares are held as treasury shares by the Company.
Removed
Total Return Analysis December 31, 2019 December 31, 2020 December 31, 2021 December 31, 2022 December 31, 2023 December 31, 2024 DMC Global Inc. $100.00 $96.24 $88.14 $43.26 $41.88 $16.36 Nasdaq Non-Financial Stocks $100.00 $148.88 $189.83 $128.35 $199.12 $250.65 Nasdaq Composite (U.S.) $100.00 $121.27 $152.67 $122.55 $154.93 $192.86 43 Table of Contents
Added
Total Return Analysis December 31, 2020 December 31, 2021 December 31, 2022 December 31, 2023 December 31, 2024 December 31, 2025 DMC Global Inc. $100.00 $91.58 $44.95 $43.51 $16.99 $15.47 Nasdaq Non-Financial Stocks $100.00 $116.68 $94.86 $133.74 $168.36 $203.76 Nasdaq Composite (U.S.) $100.00 $118.43 $107.37 $127.76 $159.03 $186.96

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

78 edited+44 added−31 removed23 unchanged
Biggest changeThe following is a reconciliation of the most directly comparable GAAP measure to Adjusted EBITDA. 2024 2023 Operating (loss) income $ (143,636) $ 21,407 Adjustments: Depreciation 3,681 3,695 Amortization of purchased intangible assets 21,111 22,608 Stock-based compensation 1,920 1,571 Goodwill impairment 141,725 — Restructuring expenses and asset impairments 645 — CEO transition expenses — 331 Adjusted EBITDA $ 25,446 $ 49,612 Less: adjusted EBITDA attributable to redeemable noncontrolling interest (10,178) (19,845) Adjusted EBITDA attributable to DMC Global Inc. $ 15,268 $ 29,767 DynaEnergetics 2024 2023 $ change % change Net sales $ 287,686 $ 315,026 $ (27,340) (9) % Gross profit 50,055 86,701 (36,646) (42) % Gross profit percentage 17.4 % 27.5 % COSTS AND EXPENSES: General and administrative expenses 10,835 15,806 (4,971) (31 %) Selling and distribution expenses 21,128 21,472 (344) (2) % Amortization of purchased intangible assets 44 59 (15) (25) % Restructuring expenses and asset impairments 1,881 3,011 (1,130) (38) % Operating income 16,167 46,353 (30,186) (65) % Adjusted EBITDA $ 24,803 $ 56,270 $ (31,467) (56) % 52 Table of Contents Net sales decreased $27,340 in 2024 compared to 2023 primarily due to a decrease in pricing of DS perforating systems as a result of industry consolidation in the United States.
Biggest changeThe following is a reconciliation of the most directly comparable GAAP measure to Adjusted EBITDA. 2025 2024 Operating income (loss) $ 4,206 $ (143,636) Adjustments: Depreciation 4,059 3,681 Amortization of purchased intangible assets 19,053 21,111 Stock-based compensation 635 1,920 Goodwill impairment — 141,725 Restructuring expenses and asset impairments 649 645 Adjusted EBITDA $ 28,602 $ 25,446 Less: adjusted EBITDA attributable to redeemable noncontrolling interest (11,441) (10,178) Adjusted EBITDA attributable to DMC Global Inc. $ 17,161 $ 15,268 DynaEnergetics 2025 2024 $ change % change Net sales $ 270,214 $ 287,686 $ (17,472) (6) % Gross profit 44,123 50,055 (5,932) (12) % Gross profit percentage 16.3 % 17.4 % COSTS AND EXPENSES: General and administrative expenses 10,751 10,835 (84) (1) % Selling and distribution expenses 22,207 21,128 1,079 5 % Amortization of purchased intangible assets — 44 (44) (100) % Restructuring expenses and asset impairments 803 1,881 (1,078) (57) % Operating income 10,362 16,167 (5,805) (36) % Adjusted EBITDA $ 18,485 $ 24,803 $ (6,318) (25) % Net sales decreased $17,472 in 2025, compared with 2024, primarily due to lower pricing as a result of industry consolidation and a highly competitive core North American market, which reduced net sales by $16,213.
Stock-based compensation is allocated to the Arcadia Products segment as 60% of such expense is attributable to the Company, whereas the remaining 40% is attributable to the redeemable noncontrolling interest holder. Segment operating income will reconcile to consolidated income (loss) before income taxes by deducting unallocated corporate expenses, unallocated stock-based compensation, other expense, net, and interest expense, net.
Stock-based compensation is allocated to the Arcadia Products segment as 60% of such expense is attributable to the Company, whereas the remaining 40% is attributable to the redeemable noncontrolling interest holder. Segment operating income (loss) will reconcile to consolidated income (loss) before income taxes by deducting unallocated corporate expenses, unallocated stock-based compensation, other expense, net, and interest expense, net.
Segment operating income is defined as revenues less expenses identifiable to the segment. DMC consolidated operating income and Adjusted EBITDA include unallocated corporate expenses and unallocated stock-based compensation expense. Stock-based compensation is not allocated to wholly owned segments, DynaEnergetics and NobelClad.
Segment operating income (loss) is defined as revenues less expenses identifiable to the segment. DMC consolidated operating income (loss) and Adjusted EBITDA include unallocated corporate expenses and unallocated stock-based compensation expense. Stock-based compensation is not allocated to wholly owned segments, DynaEnergetics and NobelClad.
Management believes providing these additional financial measures is useful to investors in understanding the Company’s operating performance, excluding the effects of restructuring, impairment, and other nonrecurring charges, as well as its liquidity.
Management believes providing these additional financial measures is useful to investors in understanding the Company’s operating performance, excluding the effects of restructuring, asset impairment, and other nonrecurring charges, as well as its liquidity.
Borrowings under the $200,000 revolving loan limit and $50,000 Term Loan can be in the form of Adjusted Daily Simple Secured Overnight Financing Rate ("SOFR") loans or one month Adjusted Term SOFR loans.
Borrowings under the $200,000 revolving loan limit and $50,000 term loan can be in the form of Adjusted Daily Simple Secured Overnight Financing Rate (“SOFR”) loans or one month Adjusted Term SOFR loans.
Off Balance Sheet Arrangements At December 31, 2024, we had no off-balance sheet arrangements, as defined by SEC rules, that have or are reasonably likely to have a material current or future effect on our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.
Off Balance Sheet Arrangements At December 31, 2025, we had no off-balance sheet arrangements, as defined by SEC rules, that have or are reasonably likely to have a material current or future effect on our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.
Management’s judgments and estimates in these areas are based on information available and at times requires management to make difficult, subjective, and complex judgments. Actual results may or may not differ from these estimates. Inventories Inventories are stated at the lower-of-cost (first-in, first-out) or net realizable value.
Management’s judgments and estimates in these areas are based on information available and at times require management to make difficult, subjective, and complex judgments. Actual results may or may not differ from these estimates. Inventories Inventories are stated at the lower-of-cost (first-in, first-out) or net realizable value.
Base Rate loans bear interest at the defined Base Rate plus an applicable margin (varying from 1.25% to 2.25%). The credit facility includes various covenants and restrictions, certain of which relate to the payment of dividends or other distributions to stockholders; redemption of capital stock; incurring additional indebtedness; mortgaging, pledging or disposition of major assets; and maintenance of specified ratios.
Base Rate loans bear interest at the defined Base Rate plus an applicable margin (varying from 1.25% to 2.25%). 50 Table of Contents The credit facility includes various covenants and restrictions, certain of which relate to the payment of dividends or other distributions to stockholders; redemption of capital stock; incurring additional indebtedness; mortgaging, pledging or disposition of major assets; and maintenance of specified ratios.
Net sales, segment operating income (loss), and Adjusted EBITDA for each segment were as follows for the years ended December 31: 2024 Arcadia Products DynaEnergetics NobelClad DMC Global Inc.
Net sales, segment operating income (loss), and Adjusted EBITDA for each segment were as follows for the years ended December 31: 2025 Arcadia Products DynaEnergetics NobelClad DMC Global Inc.
A discussion regarding our financial condition and results of operations as well as our liquidity and capital resources for fiscal 2023 compared to fiscal 2022 can be found under Item 7 in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, which is available on the SEC’s website at www.sec.gov and our Investor Relations website at www.dmcglobal.com/investors.
A discussion regarding our financial condition and results of operations as well as our liquidity and capital resources for fiscal 2024 compared to fiscal 2023 can be found under Item 7 in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, which is available on the SEC’s website at www.sec.gov and our Investor Relations website at ir.dmcglobal.com.
Based in Broomfield, Colorado, DMC trades on Nasdaq under the symbol “BOOM.” Arcadia Products On December 23, 2021, DMC completed the acquisition of 60% of the membership interests in Arcadia Products, LLC, a Colorado limited liability company resulting from the conversion of Arcadia, Inc. (collectively, “Arcadia Products”).
Based in Broomfield, Colorado, DMC’s common stock trades on Nasdaq under the symbol “BOOM.” Arcadia Products On December 23, 2021, DMC completed the acquisition of 60% of the membership interests in Arcadia Products, LLC, a Colorado limited liability company resulting from the conversion of Arcadia, Inc. (collectively, “Arcadia Products”).
Debt facilities On February 6, 2024, the Company and certain domestic subsidiaries entered into an amendment (the “First Amendment”) to its existing credit agreement with a syndicate of banks, led by KeyBank National Association (the “credit facility”). The First Amendment provided for certain changes to the credit facility, including an increase in the maximum commitment amount from $200,000 to $300,000.
Debt facilities On February 6, 2024, the Company and certain domestic subsidiaries entered into an amendment (the “First Amendment”) to its existing credit agreement with a syndicate of banks, led by KeyBank National Association (the “credit facility”). The First Amendment provided for certain changes to the credit facility and increased the maximum commitment amount from $200,000 to $300,000.
The tax benefits recognized in the Consolidated Financial Statements from such a position are measured as the largest benefit that is more likely than not to be realized upon ultimate resolution. As of December 31, 2024, we have an uncertain tax position liability of $5,240 recorded in our Consolidated Balance Sheet related to tax positions taken in prior periods.
The tax benefits recognized in the Consolidated Financial Statements from such a position are measured as the largest benefit that is more likely than not to be realized upon ultimate resolution. As of December 31, 2025, we have an uncertain tax position liability of $5,725 recorded in our Consolidated Balance Sheet related to tax positions taken in prior periods.
In making such determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning 57 Table of Contents strategies, recent financial performance and existing valuation allowances, if any.
In making such determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies, recent financial performance and existing valuation allowances, if any.
Our operating lease obligations are described in Note 6 "Leases" within Item 8 — Financial Statements and Supplementary Data. (3) Amounts represent firm commitments to purchase goods or services to be utilized in the normal course of business. These amounts are not reflected in the Consolidated Balance Sheets.
Our operating lease obligations are described in Note 6 “Leases” within Part II, Item 8 — Financial Statements and Supplementary Data. (3) Amounts represent firm commitments to purchase goods or services to be utilized in the normal course of business. These amounts are not reflected in the Consolidated Balance Sheets.
See "Use of Non-GAAP Financial Measures" above for explanation of the use of non-GAAP measures. The following is a reconciliation of the most directly comparable GAAP measures to Adjusted Net Income and Adjusted Diluted Earnings Per Share. Twelve months ended December 31, 2024 Amount Per Share (1) Net loss attributable to DMC Global Inc.
See “Use of Non-GAAP Financial Measures” above for explanation of the use of non-GAAP measures. The following is a reconciliation of the most directly comparable GAAP measures to Adjusted Net (Loss) Income and Adjusted Diluted Earnings Per Share. Twelve months ended December 31, 2025 Amount Per Share (1) Net loss attributable to DMC Global Inc.
NobelClad NobelClad produces explosion-welded clad metal plates for use in the construction of corrosion resistant industrial processing equipment and specialized transition joints for commuter rail cars, ships, and liquified natural gas (LNG) processing equipment.
NobelClad NobelClad produces explosion-welded clad metal plates for use in the construction of corrosion-resistant industrial processing equipment and specialized transition joints for commuter rail cars, ships, and LNG processing equipment.
For more information about our debt obligations, refer to Note 7 "Debt" within Item 8 — Financial Statements and Supplementary Data. (2) The operating lease obligations presented reflect future minimum lease payments due under non-cancelable portions of our leases as of December 31, 2024.
For more information about our debt obligations, refer to Note 7 “Debt” within Part II, Item 8 — Financial Statements and Supplementary Data. (2) The operating lease obligations presented reflect future minimum lease payments due under non-cancelable portions of our leases as of December 31, 2025.
Non-GAAP financial measures include the following: • EBITDA : defined as net income (loss) plus net interest, taxes, depreciation and amortization. • Adjusted EBITDA : excludes from EBITDA stock-based compensation, restructuring expenses and asset impairment charges (if applicable) and, when appropriate, nonrecurring items that management does not utilize in assessing DMC’s operating performance (as further described in the tables below). • Adjusted EBITDA attributable to DMC Global Inc. : excludes the Adjusted EBITDA attributable to the 40% redeemable noncontrolling interest in Arcadia Products. • Adjusted EBITDA for DMC business segments : defined as operating income (loss) plus depreciation, amortization, allocated stock-based compensation (if applicable), restructuring expenses and asset impairment charges (if applicable) and, when appropriate, nonrecurring items that management does not utilize in assessing DMC's operating performance. • Adjusted net income (loss) : defined as net income (loss) attributable to DMC Global Inc. stockholders prior to the adjustment of redeemable noncontrolling interest plus restructuring expenses and asset impairment charges (if applicable) and, when appropriate, nonrecurring items that management does not utilize in assessing DMC's operating performance. • Adjusted diluted earnings per share: defined as diluted earnings per share attributable to DMC Global Inc. stockholders (exclusive of adjustment of redeemable noncontrolling interest) plus restructuring expenses and asset impairment charges (if applicable) and, when appropriate, nonrecurring items that management does not utilize in assessing DMC’s operating performance. • Net debt : defined as total debt less total cash, cash equivalents and marketable securities. • Free-cash flow: defined as cash flows from operating activities less net acquisitions of property, plant and equipment.
Non-GAAP financial measures include the following: • EBITDA : defined as net income (loss) plus net interest, taxes, depreciation and amortization. • Adjusted EBITDA : excludes from EBITDA stock-based compensation, restructuring expenses and asset impairment charges (if applicable) and, when appropriate, nonrecurring items that management does not utilize in assessing DMC’s operating performance (as further described in the tables below). • Adjusted EBITDA attributable to DMC Global Inc. : excludes the Adjusted EBITDA attributable to the 40% redeemable noncontrolling interest in Arcadia Products. • Adjusted EBITDA for DMC business segments : defined as operating income (loss) plus depreciation, amortization, allocated stock-based compensation (if applicable), restructuring expenses and asset impairment charges (if applicable) and, when appropriate, nonrecurring items that management does not utilize in assessing DMC’s operating performance. • Adjusted net income (loss) : defined as net income (loss) attributable to DMC Global Inc. stockholders prior to the adjustment of redeemable noncontrolling interest plus restructuring expenses and asset impairment charges (if applicable) and, when appropriate, nonrecurring items that management does not utilize in assessing DMC’s operating performance. • Adjusted diluted earnings per share: defined as diluted earnings per share attributable to DMC Global Inc. stockholders (exclusive of adjustment of redeemable noncontrolling interest) plus restructuring expenses and asset impairment charges (if applicable) and, when appropriate, nonrecurring items that management does not utilize in assessing DMC’s operating performance. • Net debt : defined as total debt less consolidated cash, cash equivalents and marketable securities per the Consolidated Balance Sheets.
Recent Accounting Pronouncements Refer to Note 2 "Significant Accounting Policies" within Part II, Item 8 — Financial Statements and Supplementary Data in this annual report for a discussion, as applicable, of recent accounting pronouncements and their anticipated effect on our business.
Recent Accounting Pronouncements Refer to Note 2 “Significant Accounting Policies” within Part II, Item 8 — Financial Statements and Supplementary Data in this report for a discussion, as applicable, of recent accounting pronouncements and their anticipated effect on our business.
Refer to Note 2 within Item 8 — Financial Statements and Supplementary Data for further information related to the valuation of the redeemable noncontrolling interest and promissory note outstanding.
Refer to Note 2 “Significant Accounting Policies” within Part II, Item 8 — Financial Statements and Supplementary Data for further information related to the valuation of the redeemable noncontrolling interest and promissory note outstanding.
See "Use of Non-GAAP Financial Measures" above for explanation of the use of Adjusted EBITDA.
See “Use of Non-GAAP Financial Measures” above for explanation of the use of Adjusted EBITDA.
Furthermore, any restriction on the availability of borrowings under our credit facilities could negatively affect our ability to meet future cash requirements. We will continue to monitor financial market conditions, including the related impact on credit availability and capital markets.
Furthermore, any restriction on the availability of borrowings under our credit facilities could negatively affect our ability to meet future cash requirements. We will continue to monitor our short-term and long-term liquidity needs, which could be affected by financial market conditions, including the related impact on credit availability and capital markets.
Adjusted EBITDA decreased in 2024 compared with 2023 primarily due to the factors discussed above. See "Use of Non-GAAP Financial Measures" above for explanation of the use of Adjusted EBITDA.
Adjusted EBITDA decreased in 2025, compared with 2024, due to the factors discussed above. See “Use of Non-GAAP Financial Measures” above for explanation of the use of Adjusted EBITDA.
The following is a reconciliation of the most directly comparable GAAP measure to Adjusted EBITDA. 2024 2023 Operating income $ 20,051 $ 19,427 Adjustments: Depreciation 3,175 2,893 Restructuring expenses and asset impairments — 440 Adjusted EBITDA $ 23,226 $ 22,760 Liquidity and Capital Resources We have historically financed our operations from a combination of internally generated cash flow, revolving credit borrowings, and various long-term debt arrangements.
The following is a reconciliation of the most directly comparable GAAP measure to Adjusted EBITDA. 2025 2024 Operating income $ 9,557 $ 20,051 Adjustments: Depreciation 3,211 3,175 Restructuring expenses and asset impairments 1,224 — Adjusted EBITDA $ 13,992 $ 23,226 Liquidity and Capital Resources We have historically financed our operations from a combination of internally generated cash flow, revolving credit borrowings, and various long-term debt arrangements.
Cash flows from financing activities Net cash used in financing activities in 2024 totaled $59,788 and included net credit facility repayments of $45,000, distributions to the redeemable noncontrolling interest holder of $8,445, payment of debt issuance costs of $2,735, payment of a deemed dividend to the redeemable noncontrolling interest holder of $2,500, and treasury stock purchases of $1,240.
Cash flows from financing activities Net cash used in financing activities in 2025 of $28,736 included net credit facility repayments of $20,521, distributions to the redeemable noncontrolling interest holder of $6,400, payment of debt issuance costs of $650, and treasury stock purchases of $1,165. 52 Table of Contents Net cash used in financing activities in 2024 of $59,788 primarily included net credit facility repayments of $45,000, distributions to the redeemable noncontrolling interest holder of $8,445, payment of debt issuance costs of $2,735, payment of a deemed dividend to the redeemable noncontrolling interest holder of $2,500, and treasury stock purchases of $1,240.
As of December 31, 2024, we have recorded a consolidated valuation allowance of $32,121. We recognize the tax benefits from uncertain tax positions only when it is more likely than not, based on the technical merits of the position, that the tax position will be sustained upon examination, including the resolution of any related appeals or litigation.
We recognize the tax benefits from uncertain tax positions only when it is more likely than not, based on the technical merits of the position, that the tax position will be sustained upon examination, including the resolution of any related appeals or litigation.
This decrease was partially offset by lower working capital in 2024 as compared to 2023. Cash flows from investing activities Net cash used in investing activities in 2024 of $3,569 primarily related to the acquisition, net of proceeds received, of property, plant and equipment of $16,188, partially offset by proceeds from the sales and maturities of marketable securities of $12,619.
Net cash used in investing activities in 2024 of $3,569 was attributable to the acquisition, net of proceeds received, of property, plant and equipment of $16,188, partially offset by proceeds from the sales and maturities of marketable securities of $12,619.
Restructuring expenses and asset impairments of $1,881 in 2024 related to asset impairment charges of $1,104 primarily associated with the abandonment of a planned manufacturing expansion and employee severance of $777 due to headcount reductions.
Restructuring expenses and asset impairments of $1,881 in 2024 related to asset impairment charges of $1,104 associated with the abandonment of a planned manufacturing expansion and employee severance of $777 due to headcount reductions. Operating income of $10,362 in 2025 decreased compared with operating income of $16,167 in 2024, primarily due to a reduction in gross profit.
On December 3, 2024, the Company and minority interest holder entered into an amendment to the Operating Agreement whereby the minority interest holder agreed not to exercise the Put Option until on or after September 6, 2026 in exchange for, among other terms, a one-time payment of $2,500.
On December 3, 2024, the Company and minority interest holder entered into an amendment to the Operating Agreement whereby the minority interest holder agreed not to exercise the Put Option until on or after September 6, 2026.
The following is a reconciliation of the most directly comparable GAAP measure to Adjusted EBITDA. 49 Table of Contents 2024 2023 Net (loss) income $ (151,960) $ 34,759 Interest expense, net 8,664 9,516 Income tax provision 10,970 15,120 Depreciation 13,891 13,840 Amortization of purchased intangible assets 21,155 22,667 EBITDA (97,280) 95,902 Stock-based compensation 6,530 10,115 Goodwill impairment 141,725 — Strategic review expenses 7,765 — Restructuring expenses and asset impairments 2,526 3,766 CEO transition expenses — 4,343 Other expense, net 1,068 1,782 Adjusted EBITDA 62,334 115,908 Less: adjusted EBITDA attributable to redeemable noncontrolling interest (10,178) (19,845) Adjusted EBITDA attributable to DMC Global Inc. $ 52,156 $ 96,063 Adjusted Net Income and Adjusted Diluted Earnings Per Share decreased compared with 2023 due to the factors discussed above.
The following is a reconciliation of the most directly comparable GAAP measure to Adjusted EBITDA. 2025 2024 Net loss $ (11,745) $ (151,960) Interest expense, net 6,493 8,664 Income tax provision 4,066 10,970 Depreciation 14,904 13,891 Amortization of purchased intangible assets 19,053 21,155 EBITDA 32,771 (97,280) Stock-based compensation 5,748 6,530 Goodwill impairment — 141,725 Strategic review and related expenses 2,690 7,765 Restructuring expenses and asset impairments 3,578 2,526 CEO transition expenses 520 — Other expense, net 1,076 1,068 Adjusted EBITDA 46,383 62,334 Less: adjusted EBITDA attributable to redeemable noncontrolling interest (11,441) (10,178) Adjusted EBITDA attributable to DMC Global Inc. $ 34,942 $ 52,156 Adjusted Net (Loss) Income and Adjusted Diluted Earnings Per Share decreased compared with 2024 due to the factors discussed above.
The net carrying value of our purchased intangible assets as of December 31, 2024 was $174,104, which is entirely related to Arcadia Products. The net carrying values of our property, plant and equipment and right-of-use assets as of December 31, 2024 were $129,276 and $42,164, respectively.
The net carrying value of our purchased intangible assets as of December 31, 2025, was $155,051, which is entirely related to Arcadia Products. The net carrying values of our property, plant and equipment and right-of-use assets as of December 31, 2025, were $127,358 and $36,018, respectively.
Our businesses are closely monitoring the potential impact of evolving U.S. and reciprocal tariff policies. 46 Table of Contents Use of Non-GAAP Financial Measures In addition to disclosing financial results that are determined in accordance with generally accepted accounting principles in the United States (GAAP), the Company also discloses certain non-GAAP financial measures that we use in operational and financial decision making.
Use of Non-GAAP Financial Measures In addition to disclosing financial results that are determined in accordance with generally accepted accounting principles in the United States (“GAAP”), the Company also discloses certain non-GAAP financial measures that we use in operational and financial decision making.
On April 23, 2020, DMC announced that its Board of Directors suspended the quarterly dividend indefinitely. Future dividends may be affected by, among other items, our views on potential future capital requirements, future business prospects, debt covenant compliance considerations, changes in income tax laws, and any other factors that our Board of Directors deems relevant.
Payment of dividends Any determination to pay cash dividends is at the discretion of the Board of Directors. Future dividends may be affected by, among other items, our views on potential future capital requirements, future business prospects, debt covenant compliance considerations, changes in income tax laws, and any other factors that our Board of Directors deems relevant.
Amortization of purchased intangible assets decreased $1,512 for the year ended December 31, 2024 compared with 2023 as the Arcadia Products customer relationship purchased intangible asset is amortized using an accelerated amortization method.
Amortization of purchased intangible assets decreased $2,102 for the year ended December 31, 2025, compared with 2024, as the Arcadia Products customer relationship purchased intangible asset is amortized using an accelerated amortization method. Goodwill impairment of $141,725 for the year ended December 31, 2024 related to the full impairment of Arcadia Products’ goodwill.
The credit facility retains a $100,000 accordion feature to increase the commitments under the revolving loan and/or by adding one or more term loans subject to approval by the applicable lenders.
A balloon payment for the outstanding term loan balance is due upon the credit facility maturity date of February 6, 2029. The credit facility retains a $100,000 accordion feature to increase the commitments under the revolving loan and/or by adding one or more term loans subject to approval by the applicable lenders.
Restructuring expenses and asset impairments decreased $1,240 for the year ended December 31, 2024 compared with 2023. 2024 costs primarily related to the abandonment of a planned manufacturing expansion at DynaEnergetics and employee severance associated with headcount reductions at DynaEnergetics and Arcadia Products. 2023 costs included $2,471 of asset impairments primarily associated with the abandonment of a software asset at DynaEnergetics and $1,295 of cost reduction initiatives, including employee severance, primarily at DynaEnergetics.
For the year ended December 31, 2024, restructuring expenses and asset impairments of $2,526 consisted primarily of the abandonment of a planned manufacturing expansion at DynaEnergetics and employee severance costs associated with headcount reductions at DynaEnergetics and Arcadia Products.
(2) $ (94,452) $ (4.80) Goodwill impairment, net of tax 85,035 4.32 Strategic review expenses, net of tax 5,824 0.30 Restructuring expenses and asset impairments, net of tax 1,674 0.08 Establishment of income tax valuation allowance 3,900 0.20 As adjusted $ 1,981 $ 0.10 (1) Calculated using diluted weighted average shares outstanding of 19,667,673 (2) Net loss attributable to DMC Global Inc. prior to the adjustment of redeemable noncontrolling interest and deemed dividend for purposes of calculating earnings per share Twelve months ended December 31, 2023 Amount Per Share (1) Net income attributable to DMC Global Inc.
(2) $ (94,452) $ (4.80) Goodwill impairment, net of tax 85,035 4.32 Strategic review and related expenses, net of tax 5,824 0.30 Restructuring expenses and asset impairments, net of tax 1,674 0.08 Establishment of income tax valuation allowance 3,900 0.20 As adjusted $ 1,981 $ 0.10 (1) Calculated using diluted weighted average shares outstanding of 19,667,673.
Operating loss of $143,636 i n 2024 compared to operating income of $21,407 in 2023 was due to the factors discussed above. Adjusted EBITDA decreased in 2024 due to the factors discussed above. See “Use of Non-GAAP Financial Measures” above for explanation of the use of Adjusted EBITDA.
Adjusted EBITDA decreased in 2025, compared with 2024, due to the factors discussed above. See “Use of Non-GAAP Financial Measures” above for explanation of the use of Adjusted EBITDA.
As of December 31, 2024, we were in a three-year cumulative loss position at the consolidated financial statement level, driven by losses in the U.S. primarily related to the impairment of Arcadia Products’ goodwill in the third quarter of 2024.
As of December 31, 2025, we were in a three-year cumulative loss position at the consolidated financial statement level, driven by losses in the U.S. primarily related to the impairment of Arcadia Products’ goodwill in 2024. Accordingly, we have maintained the previously established valuation 53 Table of Contents allowance against the corresponding net deferred tax assets in the U.S.
The decline was primarily attributable to margin declines at DynaEnergetics and Arcadia Products, as well as lower absorption of fixed manufacturing overhead costs as a result of the decrease in consolidated sales. • Consolidated selling, general, and administrative ("SG&A") expenses were $108,656 in 2024 compared with $124,442 in 2023.
The decline was primarily attributable to less favorable project and regional mix at NobelClad, as well as lower absorption of fixed manufacturing overhead costs as a result of the decrease in net sales at both DynaEnergetics and NobelClad. • Consolidated selling, general, and administrative (“SG&A”) expenses were $110,042 in 2025, compared with $108,656 in 2024.
Based on the results of our quantitative goodwill impairment test, we recorded a $141,725 impairment charge to goodwill during the year ended December 31, 2024. Asset impairments Finite-lived assets, including purchased intangible assets, property, plant and equipment, and right-of-use assets, are tested for impairment whenever events or changes in circumstances indicate that their carrying value may not be recoverable.
Asset impairments Finite-lived assets, including purchased intangible assets, property, plant and equipment, and right-of-use assets, are tested for impairment whenever events or changes in circumstances indicate that their carrying value may not be recoverable.
Redeemable noncontrolling interest The Operating Agreement for Arcadia Products contains a right for the Company to purchase the remaining interest in Arcadia Products from the minority interest holder on or after December 23, 2024 (“Call Option”). The minority interest holder of Arcadia Products has the right to sell its remaining interest in Arcadia Products to the Company (“Put Option”).
As of December 31, 2025, we had no outstanding borrowings, and bank guarantees of €3,074 were secured. Redeemable noncontrolling interest The Operating Agreement for Arcadia Products contains a right for the Company to purchase the remaining interest in Arcadia Products from the minority interest holder on or after December 23, 2024 (“Call Option”).
Income tax provision of $10,970 was recorded on loss before taxes of $140,990 as the loss was primarily driven by the full impairment at Arcadia Products' goodwill, which did not result in a tax benefit. The effective rate was also impacted unfavorably by income generated in foreign jurisdictions and the establishment of a valuation allowance against U.S. deferred tax assets.
We recorded an income tax provision of $10,970 on loss before income taxes of $140,990 in 2024, as the loss was primarily driven by the full impairment of Arcadia Products’ goodwill, which did not result in a tax benefit.
NobelClad's backlog was $48,885 at December 31, 2024 compared to $59,357 at December 31, 2023. 45 Table of Contents Cost of products sold for NobelClad includes the cost of metals, explosive powders and other raw materials used to manufacture clad metal plates and transition joints as well as employee compensation and benefits, outside processing costs, depreciation of manufacturing facilities and equipment, manufacturing facility lease expense, supplies and other manufacturing overhead expenses.
Cost of products sold for NobelClad includes the cost of metals, explosive powders and other raw materials used to manufacture clad metal plates and transition joints as well as employee compensation and benefits, outside processing costs, depreciation of manufacturing facilities and equipment, manufacturing facility lease expense, supplies and other manufacturing overhead expenses. 41 Table of Contents Factors Affecting Results • Consolidated net sales were $609,840 in 2025 versus $642,851 in 2024, a decrease of 5%.
During the year ended December 31, 2024, we recorded impairment charges on our property, plant and equipment of $1,182. The impairment charges primarily related to a charge associated with the abandonment of a planned manufacturing expansion at DynaEnergetics.
During the year ended December 31, 2025, we recorded impairment charges on our property, plant and equipment of $1,081 primarily related to a $785 charge associated with a decision to discontinue an internal website and related automation platform.
Net loss attributable to DMC Global Inc. in 2024 was $94,452, or $(8.20) per diluted share compared with net income of $26,259, or $1.08 per diluted share, in 2023. Adjusted EBITDA in 2024 decreased compared with 2023 due to the factors discussed above. See "Use of Non-GAAP Financial Measures" above for explanation of the use of Adjusted EBITDA.
Net loss attributable to DMC Global Inc. in 2025 was $13,452, or $(0.90) per diluted share compared with net loss of $94,452, or $(8.20) per diluted share, in 2024. 45 Table of Contents Adjusted EBITDA decreased in 2025, compared with 2024, due to the factors discussed above.
We also maintain a line of credit with a German bank for certain European operations. This line of credit provides a borrowing capacity of €7,000 on which no amounts were outstanding as of December 31, 2024.
As of December 31, 2025, borrowings of $45,625 on the term loan under our credit facility were outstanding, and $6,375 was outstanding on the revolver. We also maintain a line of credit with a German bank for certain European operations. This line of credit provides a borrowing capacity of €7,000.
Given that not all companies use identical calculations, DMC’s presentation of non-GAAP financial measures may not be comparable to similarly titled measures of other companies. 47 Table of Contents Consolidated Results of Operations 2024 2023 $ change % change Net sales $ 642,851 $ 719,188 $ (76,337) (11) % Gross profit 150,569 212,052 (61,483) (29) % Gross profit percentage 23.4 % 29.5 % COSTS AND EXPENSES: General and administrative expenses 61,401 75,341 (13,940) (19) % % of net sales 9.6 % 10.5 % Selling and distribution expenses 47,255 49,101 (1,846) (4) % % of net sales 7.4 % 6.8 % Amortization of purchased intangible assets 21,155 22,667 (1,512) (7) % % of net sales 3.3 % 3.2 % Goodwill impairment 141,725 — 141,725 100 % Strategic review expenses 7,765 — 7,765 100 % Restructuring expenses and asset impairments 2,526 3,766 (1,240) (33) % Operating (loss) income (131,258) 61,177 (192,435) (315) % Other expense, net (1,068) (1,782) 714 (40) % Interest expense, net (8,664) (9,516) 852 (9) % (Loss) income before income taxes (140,990) 49,879 (190,869) (383) % Income tax provision 10,970 15,120 (4,150) (27) % Net (loss) income (151,960) 34,759 (186,719) (537) % Less: Net (loss) income attributable to redeemable noncontrolling interest (57,508) 8,500 (66,008) (777) % Net (loss) income attributable to DMC Global Inc.
Given that not all companies use identical calculations, DMC’s presentation of non-GAAP financial measures may not be comparable to similarly titled measures of other companies. 43 Table of Contents Consolidated Results of Operations 2025 2024 $ change % change Net sales $ 609,840 $ 642,851 $ (33,011) (5) % Gross profit 135,253 150,569 (15,316) (10) % Gross profit percentage 22.2 % 23.4 % COSTS AND EXPENSES: General and administrative expenses 61,252 61,401 (149) — % % of net sales 10.0 % 9.6 % Selling and distribution expenses 48,790 47,255 1,535 3 % % of net sales 8.0 % 7.4 % Amortization of purchased intangible assets 19,053 21,155 (2,102) (10) % % of net sales 3.1 % 3.3 % Goodwill impairment — 141,725 (141,725) (100) % Strategic review and related expenses 2,690 7,765 (5,075) (65) % Restructuring expenses and asset impairments 3,578 2,526 1,052 42 % Operating loss (110) (131,258) 131,148 (100) % Other expense, net (1,076) (1,068) (8) 1 % Interest expense, net (6,493) (8,664) 2,171 (25) % Loss before income taxes (7,679) (140,990) 133,311 (95) % Income tax provision 4,066 10,970 (6,904) (63) % Net loss (11,745) (151,960) 140,215 (92) % Less: Net income (loss) attributable to redeemable noncontrolling interest 1,707 (57,508) 59,215 103 % Net loss attributable to DMC Global Inc.
As of December 31, 2024, we were in compliance with all financial covenants and other provisions of our debt agreements. 54 Table of Contents The leverage ratio is defined in the credit facility as the ratio of Consolidated Funded Indebtedness (as defined in the credit facility) on the last day of any trailing four quarter period to Consolidated EBITDA (as defined in the credit facility) for such period.
The leverage ratio is defined in the credit facility as the ratio of Consolidated Funded Indebtedness (as defined in the credit facility) on the last day of any trailing four quarter period to Consolidated EBITDA (as defined in the credit facility) for such period.
To determine provision amounts, we regularly review inventory quantities on hand and values, and compare them to estimates of future product demand, market conditions, production requirements and technological developments.
To determine provision amounts, we regularly review inventory quantities on hand and values, and compare them to estimates of future product demand, market conditions, production requirements and technological developments. If assumptions about future demand change and/or actual market conditions are less favorable than those projected by the Company, additional write-downs of inventories may be required.
Other contractual obligations and commitments The table below presents principal cash flows by expected maturity dates for our debt obligations and other contractual obligations and commitments as of December 31, 2024: Payment Due by Period As of December 31, 2024 Less than More than Other Contractual Obligations 1 Year 2026 - 2027 2028 - 2029 5 Years Total Credit facility (1) $ 2,500 $ 7,188 $ 62,812 $ — $ 72,500 Operating lease obligations (2) 10,302 17,285 10,774 22,613 60,974 Purchase obligations (3) 87,536 — — — 87,536 Total (4) $ 100,338 $ 24,473 $ 73,586 $ 22,613 $ 221,010 (1) Represents outstanding borrowings under our credit facility but excludes future interest expense on outstanding credit facility borrowings.
Other contractual obligations and commitments The table below presents principal cash flows by expected maturity dates for our debt obligations and other contractual obligations and commitments as of December 31, 2025: Payment Due by Period As of December 31, 2025 Less than More than Other Contractual Obligations 1 Year 2027 - 2028 2029 - 2030 5 Years Total Credit facility (1) $ 3,438 $ 8,438 $ 40,124 $ — $ 52,000 Operating lease obligations (2) 10,171 16,658 8,381 18,778 53,988 Purchase obligations (3) 53,927 — — — 53,927 Total (4) $ 67,536 $ 25,096 $ 48,505 $ 18,778 $ 159,915 (1) Represents outstanding borrowings under our credit facility but excludes future interest expense on outstanding credit facility borrowings.
The mix of income or loss before income taxes between these jurisdictions is one of the primary drivers of the difference between our 21% statutory tax rate and our effective tax rate. The effective rate was also impacted unfavorably by state taxes and certain compensation expenses that are not tax deductible in the U.S.
Our most significant operations are in the United States, which has a 21% statutory income tax rate, and Germany, which has a 32% combined statutory income tax rate. The mix of income or loss before income taxes between these jurisdictions is one of the primary drivers of the difference between our 21% statutory tax rate and our effective tax rate.
Under our credit facility, the minimum debt service coverage ratio permitted is 1.25 to 1.0. The actual debt service coverage ratio for the trailing twelve months ended December 31, 2024 was 3.41 to 1.0. As of December 31, 2024, borrowings of $48,125 on the Term Loan under our credit facility were outstanding, and $24,375 was outstanding on the revolver.
Under our credit facility, the minimum debt service coverage ratio permitted is 1.25 to 1.0. The actual debt service coverage ratio for the trailing twelve months ended December 31, 2025, was 3.28 to 1.0. On June 10, 2025, the Company and certain domestic subsidiaries entered into an amendment to the credit facility (the “Second Amendment”).
The decrease was due to a reduction in outstanding debt attributable to voluntary repayments made after execution of the credit agreement amendment in February 2024. • The Company’s leverage ratio, calculated in accordance with its credit facility, was 1.35 to 1.0 as of December 31, 2024 in comparison to the maximum ratio permitted of 3.0 to 1.0.
The decrease was driven by voluntary credit facility repayments resulting in a reduction in outstanding debt and an increase in consolidated cash, cash equivalents and marketable securities compared with the same period in 2024. • The Company’s leverage ratio, calculated in accordance with its credit facility, was 1.22x as of December 31, 2025, and 1.35x as of December 31, 2024, in comparison to the maximum ratio permitted of 3.0x for each of the periods.
Selling and distribution expenses were lower by $344 compared with 2023 primarily due to a decrease in compensation costs of $1,639, marketing consulting costs of $1,572 and business-related travel of $170, partially offset by an increase in bad debt expense of $3,100.
Selling and distribution expenses were higher by $1,079, compared with 2024, primarily due to an increase in net bad debt expense of $1,549, partially offset by decreased selling costs of $483 driven by lower net sales.
Accordingly, during the year ended December 31, 2024, we evaluated the impact on all jurisdictions and have recorded a valuation allowance against the corresponding net deferred tax assets in the U.S. We also have a valuation allowance recorded against deferred tax assets in certain of our foreign jurisdictions.
We also have a valuation allowance recorded against deferred tax assets in certain of our foreign jurisdictions. As of December 31, 2025, we have recorded a consolidated valuation allowance of $35,323.
Gross profit percentage was 23.4% versus 29.5% in 2023. The decline compared to prior year was primarily attributable to margin declines at DynaEnergetics and Arcadia Products, as well as lower absorption of fixed manufacturing overhead costs as a result of the decrease in consolidated sales.
The decline was primarily attributable to less favorable project and regional mix at NobelClad, as well as lower absorption of fixed manufacturing overhead costs as a result of the decrease in net sales at both DynaEnergetics and NobelClad.
Quarterly term loan amortization increases to $938 on June 30, 2026 through March 31, 2028, and increases to $1,250 from June 30, 2028 through December 31, 2028. A balloon payment for the outstanding term loan balance is due upon the credit facility maturity date of February 6, 2029.
The $50,000 term loan facility outstanding is payable in installments of $625 per quarter through March 31, 2026. Quarterly term loan payments increase to $938 on June 30, 2026, through March 31, 2028, and increase to $1,250 from June 30, 2028, through December 31, 2028.
(2) $ 26,259 $ 1.35 CEO transition expenses and accelerated stock-based compensation, net of tax 6,284 0.32 Restructuring expenses and asset impairments, net of tax 2,773 0.14 As adjusted $ 35,316 $ 1.81 (1) Calculated using diluted weighted average shares outstanding of 19,518,382 (2) Net income attributable to DMC Global Inc. prior to the adjustment of redeemable noncontrolling interest for purposes of calculating earnings per share 50 Table of Contents Business Segment Financial Information We primarily evaluate performance and allocate resources based on segment revenues, operating income and Adjusted EBITDA as well as projected future performance.
(2) Net loss attributable to DMC Global Inc. prior to the adjustment of redeemable noncontrolling interest and deemed dividend. 46 Table of Contents Business Segment Financial Information We primarily evaluate performance and allocate resources based on segment revenues, operating income (loss) and Adjusted EBITDA as well as projected future performance.
Net Sales 298,909 $ 315,026 $ 105,253 $ 719,188 % of Consolidated 41.6 % 43.8 % 14.6 % Operating income 21,407 46,353 19,427 61,177 Adjusted EBITDA attributable to DMC Global Inc. 29,767 56,270 22,760 96,063 Arcadia Products 2024 2023 $ change % change Net sales $ 249,763 $ 298,909 $ (49,146) (16) % Gross profit 67,025 92,252 (25,227) (27) % Gross profit percentage 26.8 % 30.9 % COSTS AND EXPENSES: General and administrative expenses 30,881 30,488 393 1 % Selling and distribution expenses 16,299 17,749 (1,450) (8) % Amortization of purchased intangible assets 21,111 22,608 (1,497) (7) % Goodwill impairment 141,725 — 141,725 100 % Restructuring expenses and asset impairments 645 — 645 100 % Operating (loss) income (143,636) 21,407 (165,043) (771) % Adjusted EBITDA 25,446 49,612 (24,166) (49) % Less: adjusted EBITDA attributable to redeemable noncontrolling interest (10,178) (19,845) 9,667 (49) % Adjusted EBITDA attributable to DMC Global Inc. $ 15,268 $ 29,767 $ (14,499) (49) % 51 Table of Contents Net sales of $249,763 in 2024 decreased $49,146 compared to 2023 primarily due to lower sales volumes in longer-cycle high-end residential markets.
Net Sales $ 249,763 $ 287,686 $ 105,402 $ 642,851 % of Consolidated 38.8 % 44.8 % 16.4 % Operating (loss) income (143,636) 16,167 20,051 (131,258) Adjusted EBITDA attributable to DMC Global Inc. $ 15,268 $ 24,803 $ 23,226 $ 52,156 Arcadia Products 2025 2024 $ change % change Net sales $ 246,208 $ 249,763 $ (3,555) (1) % Gross profit 66,668 67,025 (357) (1) % Gross profit percentage 27.1 % 26.8 % COSTS AND EXPENSES: General and administrative expenses 25,171 30,881 (5,710) (18) % Selling and distribution expenses 17,589 16,299 1,290 8 % Amortization of purchased intangible assets 19,053 21,111 (2,058) (10) % Goodwill impairment — 141,725 (141,725) (100) % Restructuring expenses and asset impairments 649 645 4 1 % Operating income (loss) 4,206 (143,636) 147,842 103 % Adjusted EBITDA 28,602 25,446 3,156 12 % Less: adjusted EBITDA attributable to redeemable noncontrolling interest (11,441) (10,178) (1,263) 12 % Adjusted EBITDA attributable to DMC Global Inc. $ 17,161 $ 15,268 $ 1,893 12 % 47 Table of Contents Net sales decreased $3,555 in 2025, compared with 2024, primarily due to lower sales volumes in longer-cycle high-end residential markets.
Selling and distribution expenses decreased $1,450 in 2024 compared to 2023 due to lower compensation costs. Amortization of purchased intangible assets decreased $1,497 in 2024 compared to 2023 as the customer relationship purchased intangible asset is amortized using an accelerated amortization method.
Amortization of purchased intangible assets decreased $2,058 in 2025, compared with 2024, as the customer relationship purchased intangible asset is amortized using an accelerated amortization method. Goodwill impairment of $141,725 in 2024 related to the full impairment of Arcadia Products’ goodwill.
Interest expense, net of $8,664 in 2024 decreased 9% compared with 2023 due primarily to lower outstanding balances on our credit facility due to voluntary debt repayments during 2024.
Interest expense, net of $6,493 in 2025 decreased 25% compared with 2024, primarily attributable to lower outstanding balances on our credit facility due to voluntary debt repayments during 2025. Income tax provision of $4,066 was recorded on loss before income taxes of $7,679 for the year ended December 31, 2025.
We use backlog, defined as all unfilled firm purchase orders and commitments at a point in time, to measure the immediate outlook for our NobelClad business. Most firm purchase orders and commitments are realized and shipped within twelve months.
DynaEnergetics also is exploring growth opportunities in the enhanced geothermal market, and has expanded its sales and marketing efforts in certain emerging global shale markets. At NobelClad, we use backlog, defined as unfilled firm purchase orders and commitments at a point in time, to assess near-term demand. Most firm purchase orders and commitments are realized and shipped within twelve months.
The following is a reconciliation of the most directly comparable GAAP measure to Adjusted EBITDA. 2024 2023 Operating income $ 16,167 $ 46,353 Adjustments: Depreciation 6,711 6,847 Amortization of purchased intangible assets 44 59 Restructuring expenses and asset impairments 1,881 3,011 Adjusted EBITDA $ 24,803 $ 56,270 NobelClad 2024 2023 $ change % change Net sales $ 105,402 $ 105,253 $ 149 — % Gross profit 33,811 33,529 282 1 % Gross profit percentage 32.1 % 31.9 % COSTS AND EXPENSES: General and administrative expenses 4,299 4,092 207 5 % Selling and distribution expenses 9,461 9,570 (109) (1) % Restructuring expenses and asset impairments — 440 (440) (100) % Operating income 20,051 19,427 624 3 % Adjusted EBITDA $ 23,226 $ 22,760 $ 466 2 % Net sales and gross profit percentage were consistent in 2024 compared with 2023 due to steady, healthy activity in core energy and petrochemical end markets, including Cylindra™ cryogenic transition joints and pressure vessel plate shipments.
The following is a reconciliation of the most directly comparable GAAP measure to Adjusted EBITDA. 2025 2024 Operating income $ 10,362 $ 16,167 Adjustments: Depreciation 7,320 6,711 Amortization of purchased intangible assets — 44 Restructuring expenses and asset impairments 803 1,881 Adjusted EBITDA $ 18,485 $ 24,803 NobelClad 2025 2024 $ change % change Net sales $ 93,418 $ 105,402 $ (11,984) (11) % Gross profit 24,741 33,811 (9,070) (27) % Gross profit percentage 26.5 % 32.1 % COSTS AND EXPENSES: General and administrative expenses 5,169 4,299 870 20 % Selling and distribution expenses 8,791 9,461 (670) (7) % Restructuring expenses and asset impairments 1,224 — 1,224 100 % Operating income 9,557 20,051 (10,494) (52) % Adjusted EBITDA $ 13,992 $ 23,226 $ (9,234) (40) % Net sales decreased $11,984 in 2025, compared with 2024, reflecting lower activity levels due in part to the impact of evolving tariff policies throughout the year.
Selling and distribution expenses decreased $1,846 for the year ended December 31, 2024 compared with 2023. The lower expense was driven by a decrease in compensation cost of $3,571 and outside marketing consulting costs of $1,564, partially offset by an increase in bad debt expense for $3,784.
Selling and distribution expenses increased $1,535 for the year ended December 31, 2025, compared with 2024, driven by higher compensation costs at Arcadia Products of $1,357 and higher bad debt expense of $1,153. These increases were partially offset by lower outside services costs of $532, a reduction in business-related travel of $214, and lower selling costs of $109.
The maximum leverage ratio permitted by our credit facility is 3.00 to 1.0. The actual leverage ratio as of December 31, 2024, calculated in accordance with the amended credit facility, was 1.35 to 1.0.
The maximum leverage ratio currently permitted by our credit facility is 3.0 to 1.0; provided, however, that the Second Amendment (as defined below) provides for a temporary increase in the maximum leverage ratio under certain circumstances as described below. The actual leverage ratio as of December 31, 2025 was 1.22 to 1.0.
The credit facility allows for revolving loans of up to $200,000, a $50,000 term loan facility, and a $50,000 delayed draw term loan facility that can be accessed by the Company at its discretion until February 6, 2026. The $50,000 term loan facility is amortizable at $625 per quarter beginning on June 30, 2024 through March 31, 2026.
The credit facility originally allowed for revolving loans of up to $200,000, a $50,000 term loan facility, and a $50,000 delayed draw term loan (“DDTL”) facility. On February 6, 2026, the ability of the Company to access the $50,000 DDTL facility expired per the terms of the First Amendment.
Gross profit percentage decreased to 17.4% primarily due to lower customer pricing as well as lower absorption of fixed manufacturing overhead costs as a result of the decrease in net sales. General and administrative expenses were lower by $4,971 compared with 2023 primarily due to a decrease in patent infringement litigation costs of $3,610 and compensation costs of $1,334.
Gross profit percentage decreased to 26.5% in 2025 due to a less favorable project and regional mix as well as lower absorption of fixed manufacturing overhead costs as a result of the decrease in net sales described above.
Operating loss of $131,258 for the year ended December 31, 2024 was primarily attributable to the goodwill impairment charge at Arcadia Products and decreased financial performance at DynaEnergetics. Operating income in 2023 was $61,177. Other expense, net of $1,068 in 2024 primarily related to net realized foreign currency exchange losses.
Operating loss of $110 for the year ended December 31, 2025, decreased compared with operating loss of $131,258 for the year ended December 31, 2024, primarily attributable to the goodwill impairment charge recorded in 2024, and a reduction in strategic review and related expenses.
Both the Call Option and Put Option enable the respective holder to exercise their rights based upon a predefined calculation as included within the Operating Agreement. As of December 31, 2024, the value of the redeemable noncontrolling interest was $187,080. Upon settlement, consideration paid will be net of the $24,902 promissory note outstanding due from the redeemable noncontrolling interest holder.
Upon settlement, consideration paid will be net of the $24,902 promissory note outstanding due from the redeemable noncontrolling interest holder and is subject to potential working capital adjustments.
(“DMC”, "we", "us", "our", or the "Company") owns and operates Arcadia Products, DynaEnergetics and NobelClad, three innovative, asset-light manufacturing businesses that provide differentiated products and engineered solutions to segments of the construction, energy, industrial processing and transportation markets. Our businesses seek to capitalize on their product and service differentiation to expand profit margins, increase cash flow and enhance shareholder value.
Our businesses seek to capitalize on their product and service differentiation to expand profit margins, increase cash flow and enhance shareholder value.
(4) The above table does not include amounts potentially payable upon exercise of the Put Option or Call Option associated with the redeemable noncontrolling interest. 55 Table of Contents Cash flows from operating activities Net cash provided by operating activities of $46,596 in 2024 decreased compared to $65,927 in 2023 primarily driven by lower net income attributable to a decline in financial performance at Arcadia Products and DynaEnergetics.
(4) The above table does not include amounts potentially payable upon exercise of the Put Option or Call Option associated with the redeemable noncontrolling interest.
General and administrative expenses increased by $207 compared with 2023 primarily due to higher variable compensation costs. Operating income increased $624 compared to 2023 due in part to an increase in gross profit. 53 Table of Contents Adjusted EBITDA increased due to the factors discussed above.
Operating income of $4,206 i n 2025 increased compared with operating loss of $143,636 in 2024, primarily attributable to the goodwill impairment charge recorded in 2024, and lower general and administrative expenses. Adjusted EBITDA increased in 2025, compared with 2024, due to the factors discussed above.
In connection with this process, strategic review expenses primarily included $4,076 in professional service fees and $2,988 in employee retention compensation, including $372 of stock-based compensation. On October 21, 2024, the Company announced that the Board was no longer actively marketing the DynaEnergetics and NobelClad segments.
Strategic review and related expenses of $2,690 for the year ended December 31, 2025 primarily related to $2,099 in professional service fees and $366 in employee retention compensation, including $36 of stock-based compensation. 44 Table of Contents For the year ended December 31, 2024, strategic review and related expenses of $7,765 related to $4,076 in professional service fees and $2,988 in employee retention compensation, including $372 of stock-based compensation.
Our net debt position was $56,529 at December 31, 2024 compared to $72,192 at December 31, 2023. The decrease in net debt during 2024 was due to a reduction in outstanding debt attributable to voluntary repayments made after executing the amended credit agreement in February 2024.
Our net debt position was $18,746 at December 31, 2025, compared with $56,529 at December 31, 2024. The decrease in net debt was primarily due to cash flow generated from operations, which resulted in net credit facility repayments of $20,521.
Restructuring expenses and asset impairments in 2023 were attributable to $1,140 of cost reduction initiatives, primarily employee severance, and an asset impairment charge of $1,871 associated with the abandonment of a software asset. Operating income decreased by $30,186 compared with 2023 due to a decrease in gross profit.
Restructuring expenses and asset impairments of $1,224 in 2025 included contract termination costs associated with exiting a lease totaling $1,013 and employee severance of $211 related to headcount reductions. 49 Table of Contents Operating income of $9,557 in 2025 decreased compared with operating income of $20,051 in 2024, primarily due to a reduction in gross profit.
Unless stated otherwise, all dollar figures in this report are presented in thousands (000s). N/M indicates that the change in dollars or percentage was not meaningful. Overview General DMC Global Inc.
Unless stated otherwise, all dollar figures in this report are presented in thousands (000s). Overview General DMC Global Inc. (“DMC”, “we”, “us”, “our”, or the “Company”) operates three manufacturing businesses: Arcadia Products, DynaEnergetics and NobelClad, which produce differentiated products and engineered solutions primarily for the construction, energy, and industrial processing markets.
Removed
Factors Affecting Results • Consolidated net sales were $642,851 in 2024 versus $719,188 in 2023, a decrease of 11%.
Added
The decline was primarily attributable to lower sales at DynaEnergetics and NobelClad. The decrease in DynaEnergetics’ sales largely resulted from lower pricing due to industry consolidation and a highly competitive core North American market.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

5 edited+1 added−0 removed4 unchanged
Biggest changeAt December 31, 2024, all of the Company's debt was subject to variable interest rates. A one percentage point increase in average interest rates would cause interest expense, net in 2024 to increase by $947. This was determined by considering the impact of a hypothetical interest rate on the Company's average outstanding variable debt.
Biggest changeInterest Rate Risk The Company’s interest expense is sensitive to the general level of interest rates in North America and Europe. At December 31, 2025, all of the Company’s debt was subject to variable interest rates. A one percentage point increase in average interest rates would cause interest expense, net in 2025 to increase by $700.
However, due to the uncertainty of the specific actions that might be taken and their possible effects, the sensitivity analysis assumes no changes in the Company's financial structure. 58 Table of Contents
However, due to the uncertainty of the specific actions that might be taken and their possible effects, the sensitivity analysis assumes no changes in the Company’s financial structure. 54 Table of Contents
Changes in the exchange rates for such currencies into U.S. dollars can affect our revenues, earnings, and the carrying value of our assets and liabilities in our Consolidated Balance Sheets, either positively or negatively. Sales made in currencies other than U.S. dollars accounted for 11%, 9%, and 6% of total sales for the years ended 2024, 2023, and 2022, respectively.
Changes in the exchange rates for such currencies into U.S. dollars can affect our revenues, earnings, and the carrying value of our assets and liabilities in our Consolidated Balance Sheets, either positively or negatively. Sales made in currencies other than U.S. dollars accounted for 10%, 11%, and 9% of total sales for the years ended 2025, 2024, and 2023, respectively.
This analysis does not consider the effect of the level of overall economic activity that could exist. In the event of a change in the level of economic activity, which may adversely impact interest rates, the Company could likely take actions to further mitigate any potential negative exposure to the change.
In the event of a change in the level of economic activity, which may adversely impact interest rates, the Company could likely take actions to further mitigate any potential negative exposure to the change.
As such, these forward currency contracts and the offsetting underlying asset and liability positions do not create material market risk. The notional amount of the foreign exchange contracts at December 31, 2024 and 2023 was $8,331 and $32,310, respectively. Interest Rate Risk The Company's interest expense is sensitive to the general level of interest rates in North America and Europe.
As such, these forward currency contracts and the offsetting underlying asset and liability positions do not create material market risk. The net notional amount of the foreign exchange contracts at December 31, 2025, and 2024, was $10,858 and $8,331, respectively.
Added
This was determined by considering the impact of a hypothetical interest rate on the Company’s average outstanding variable debt. This analysis does not consider the effect of the level of overall economic activity that could exist.

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